Course Introduction

Dear distance education learner, well come to the course Management Information System.
This course will enable you to understand issues in business communication including,
communication theories and various channels of communication. The course is organized into
eight units, Unit One: Decision making – An overview, Unit Two: Conceptual foundations of
information systems, Unit Three: Information resources management, Unit Four: Overview of
systems analysis and designs, Unit Five: System development life cycle, Unit six: Designing on
line and distributed environments design consideration, Unit seven: Implementation and control
of projects, Unit eight: Trends in information-technology-hardware, software.

Dear learner therefore you are required to cover all the eight units to sit on the final exam. And if
you have points in the module that are not clear please make them ready to be elaborated to you
during the tutorial class.

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 UNIT ONE
DECISION MAKING

Objectives
After going through this unit you should be able to:
 appreciate the nature and variety of managerial decisions
 develop decision table logic for structured and programmed decisions
 make decision making process
 understand the relevance of various models of individual and organizational decision
making
 give examples of how information systems support various states of decision

Structure
1.1. Introduction to Decision Making
1.2. Structured Decisions
1.2.1 Decision Tables for Structured/Programmed Decisions
1.3. Unstructured Decisions
1.4. Additional Categories
1.4.1 Departmental. Inter-Departmental and Enterprise Decisions
1.4.2 Organizational and Personal Decisions
1.4.3 Individual and Group Decision Making
1.5. Decision Making Process
1.5.1 Simon's Decision Making Model
1.5.2 Massie's Decision Making Model
1.6. Information Requirements for Different Decision Making Stages
1.6.1 Information for Intelligence Phase
1. 6.2 Information for the, Design Phase
1.6.3 Information for the Choice Phase
1.6.4 Information for the Implementation Phase Rational Individual Models of Decision
1.7. Making

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 1.7.1. Rational Model
1.7.2 Bounded Rationality and Satisfying
1.7.3. Muddling through Model.
1.7.4 Psychological Types and Frames of Reference
1.7.5 Implications of the Models for Information Decisions
1.8. Organizational Models for Decision Making
1.8. 1. Implications for Information System: Design
1.9. Summary
1.10. Self-assessment Exercises

1.1. INTRODUCTION TO DECISION MAKING

The field of decision making is vast. There have been many approaches to managerial decision
making. These have ranged from the strictly quantitative as typified by the methods of operations
research - to those based on human and organizational behavior. It is only recently that those
working in the area of decision making have started to combine approaches that could cater to
the multiplicity of subjective and objective factors; and the multiplicity of criteria and objectives
some in conflict with one another.
Decision making is an essential part of management. Some have even suggested that
management is synonymous with decision making. Managers are decision makers and problem
solvers. Whether a manager is involved in evaluating new opportunities or eliminating long
standing difficulties, decision making for management is essentially problem solving. The prices
of deciding are intimately related to the whole process of knowing (or cognition). Knowing what
the problem is will assist in deciding what to do about it that is finding the best solution. This is
basic for each individual
Personally and also for a professional manager, whose main orientation is towards the making of
decisions. There is always an implicit opportunity loss associated with poor decisions. They are
the foregone gains, profits, which could have been realized had a better decision been made.
However, the process by which one arrives at a decision is quite complex; in fact no one process
can he applied to all decisions. Over the decades, decision-making methods have evolved from
primitive to super sophisticated/ranging from the instinctive/intuitive approach, to traditional

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precedent based approach, to the commonsense approach, to the scientific method. A decision
involves many intuitive and deep, seated cognitive mechanisms that cannot be observed fully or
directly influenced. What can be influenced are the behavior patterns, the analytical procedures
and the sequence of logic that are followed in making a decision. Ideals objectives and goals
form the background against which decisions are made. There are many types of decisions some
that are completely specified, some partly specified and many unspecified. We shall discuss how
computers have entered in decision aiding process, who all is the end users of the systems, the,
different types of decisions, the decision ranking process and the implications for the information
systems analyst. It would be our effort to minimize repetition of concepts or subject that we have
already discussed in previous courses or modules. These, however, are important and should be
referred to for better understanding and appreciation.

Let us look at the different types of decisions that are encountered by managed would like to
categories them primarily into two categories, structured and unstructured.

1.2 STRUCTURED DECISIONS

These structured decisions are also that can be programmed. They are essentially repetitive,
routine and involve a definite procedure for handling them so that they do not have to be treated
each time as if they were new.
It has been seen that in general at the lowest level in the organization viz., the operational level
and the managerial staff deal mostly with such fairly well structure problems. In the past most
successful applications of information systems have Coli in dealing with structured, operational
and management control decisions. These f really in the domain of transaction processing and it
is for this reason that some researchers prefer to call such systems as TPS - Transaction
Processing Systems, rather than MIS - Management Information Systems.

Thus structured decisions which are also called programmable decisions involve situations where
the procedures to follow when a decision is needed can be specified in advance. Therefore, such
decisions are -structured or programmed by the decision procedures or decision rules developed
for them. A structured decision could possibly involve what is known as a deterministic decision
or an algorithmic (step by step procedure) decision. In this case, the outcome of a decision can be

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determi.ledwi1 certainty' if a specified sequence of activities viz., the algorithm, is performed.
No doubt many decision situations do not all come under deterministic criteria. Their might be
probabilistic decision situations Since, in this- case, enough probabilities about possible
outcomes, are known, a decision can be statistically taken or determined with an acceptable
probability of success.
Herbert A. Simon stresses the programmable part of the structured decisions and accordingly
terms 'structured decisions as programmed decisions!. In the -programmed decisions, a problem
(or one very similar) occurs frequently enough that a fixed routine or program is established for
solving it. Programmed decision are in fact those that are made in accordance with some policy
role or procedure that they do not have to be handled de novo each time they occur. In fact these
decisions are generally repetitive and routine and are obviously the easiest for managers to make.
It is for these reasons that such managerial problems are relegates to the supervisory level. The
supervisors fall in the first entry ring of management. It gives persons of this level the slight
'kick' or morale boost as they have entered into the 'management category. No doubt the
perceptions will have to change since they have moved across from the worker/operator level to
the other side of the table. Decisions implemented by the supervisors might feel elated, but when
compared to managers at the higher levels, the Supervisory level decisions are pretty straight
forward and simple because of their structured nature. These decisions are in fact routine
decisions and they require 1ittle deliberation from the top man's point of view. These routine
decisions are taken against a familiar background in everyday business operations. Such
decisions involve no extraordinary judgment, analysis or authority, since they are to traverse
through more or less fixed avenues. On account of the experience gained or because of the trivial
nature of the problems on hand, management has already established a set of rules, policies and
procedures. With the organization’s goals, policies and processes established, the routine
decisions demand, on the part of managers; a power of selection of the best path, as the
connecting link between the given means and the established ends..
The structured decisions, often termed as programmed decisions, are labels that are derived from
the jargon of the computer field, where a program is defined as it plan for the automatic solution
of a problem. Programs are simply a string of instructions to accomplish an assignment.
However, it is well known that all problems do not lead themselves to automatic programmed
solutions. No doubt an information system analyst might be having his cherished dream of

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having a.1I decisions in an organization programmed or fully automatic. Then perhaps there
would be no dividing line as regards variety of type of skills required by managers is various
levels. You would recollect that studies have shown that more technical skills are required at the
lower levels whereas more conceptual skills are required by managers at the higher levels, apart
from human skills that are required at all levels of management.

It has been seen that by far the greatest number of business decisions are repetitive and routine
ones. If this is true, then there is an overriding need to automate or program these decisions so
that managers and executives could delegate such problems to lower levels and have them made
by one or more techniques of programmed decisions. It is interesting to note that in some cases
even up to 90% of management decisions are routine ones.
Most programmed decisions are solvable by the force of habit. We go to our offices, make
decisions about the in-basket or in-tray correspondence, and take dozens of actions daily that are
programmed through sheer force of habit. In fact this is gained by 'experience' in an organization.
Whenever were are turnovers, it is this valuable experience that is lost, which could be quite
costly, It usually takes time and money for newer recruits to acquire this experience.

The 'force' of habit in fact leads to certain traditions conventions and practices which might
become a platform towards formal statement of rules, procedures, policies, etc. At this stage, it
would be worthwhile to spend some time looking at what constitutes a rule, procedure or a
policy.
A rule is a specific policy statement about the conduct of certain affairs. For instance, the rule
may state that any person who comes in late to work will face disciplinary action. It could he that
if an employee is to start his office hours from 9.00 a.m. if he come. by 9.15 a.m. he could be
tolerated. Time between 9.15 a.m. to 9.30a.m could be allowed at best say thrice in a month.
Anything beyond these limits would necessitate some disciplinary action. A rule is frequently
used when confronting a well structured problem. Rules are usually rigid which might
specifically tell about do and don’ts. Rules are usually framed in a manner to take care of almost
all Situations. However, we do have instances where the rule applies - 'show me the man of show
you the rule. You often hear the term that 'rules lire' silent on this issue indeed rules arc quoted
again and again depending on what is to be proved or justified or rationalized In order to take the

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final decision.

Activity A
Could you enumerate the rules followed in your organization by you in seeking a temporary
replacement for three days for an absent typing clerk?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
________________________________________________________________

A procedure is a series of steps that are sequential in nature and interrelated to address a well
structured problem. A procedure is a kind of direction in using a series of steps in either
diagnosing a problem or solving it. For instance, if your car is not working the mechanic has a
manual of procedures to check the trouble and follow procedures to correct it. He might, like to
first find out whether he is petrol in the tank. If petrol is tt1ere be might, like to check the battery
terminals to see whether they are loose. With experience it is possible to have shortcut in
diagnosis, which might sometimes appear to be done on a random basis or just on a trial and
error basis. Now the many procedures could be written, oral or implied. The procedure has the
additional advantage of forcing a certain amount of detailed planning, because it cannot be
adequately designed, reviewed, or implemented without careful thought.

Activity B
What would be the procedure followed by you to method a leaking tap in your bathroom?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
_________
As for a policy; it is a general guideline which sets up parameters for the judgment within which
to operate and is general and judgmentally nature. For instance, the policy of a company may be
the customer is always right. But it is left to the manager to rightfully interpret this policy in a
particular situation. It is indeed possible that there could be a bias, even perhaps an emotional

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outburst 'and sometimes an immature and unrealistic response of the customer. Should the policy
be, implemented in true letter and spirit? Should one think of the policy in the long-run or short-
run? Now if the case is to be considered under the structured programmed decision category
some definite answers would have to be provided rather than leaving it ambiguous vague and
fuzzy.

1.2.1 Decision Tables for Structured/Programmed Decision

Let us demonstrate the use of a decision table in the contents of a programmed or structured
decision. Consider an accounts receivable process in which customers accounts are examined
with the purpose of producing a statement and a possible reminder, of variable severity, for each
account;
The analyst’s first step is to decide upon the set of preterit applicable. By discussing with various
relevant groups of people three unrelated possibilities are discovered (1) that within 30 days the
amount exceeds 5,000- (2) that within 60,days the amount exceeds 2,000/- and (3) there is still
an amount to be paid on goods, purchased more than.60 days ago. Let us denote these condition
stubs as AR1, AR2, AR3 respectively.

The possible answers 10 each of these questions is a sample yes (Y) or no (N). Thus there are a
maximum of 21 = 8 rules corresponding to the possible combinations of answers. These are
placed in the condition entry section of, the table, one per decision rule column. There is no
significance attached to the order in which the rules are written, provided that all possible entries
are recorded. However, it is sometimes possible to combine two or more rules if it is known that
the ensured actions are all identical.

By further questioning, the analyst establishes the complete list of all possible actions and writes
them in the action stub one per line. Suppose that by the time this section of the system is
activated a preliminary' operation bas by Passed all those customers not needed a statement, and
has already it Statement for whom one is due. The only task remaining is to produce one or more
of:
 A moderate remainder (letter A)
 A more severe remainder (letter B)

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  A very terse post script to either letter (the same in each case)

Conditional DECISION TABLE

Stub 1 2 3 4 5 6 7 8
AR1 5,000 N Y N Y N Y N Y
AR2 2,000 N N Y Y N N Y Y
AR3 0 N N N N Y Y Y Y
Action stub X x
Letter A
(Moderate
Remainder)
Letter B X X X X
(Severe
Remainder)
Terse post X X
Script
Exception X
Report
Go To X X X X X X X X
NEXT

Figure 1.1 Accounts receivable programmed decision table

The above decisions table can be used for writing a program in an appropriate computer
language.

It is worthwhile to note the orderly nature of the inquiries into which the analyst is led. In fact
this is a most valuable discipline tending to regulars the Otherwise freedom questioning which
may occur having exposed the table in as concise a form as possible, a programmer can now
proceed directly with the encoding process, or use the table to construct a formal flowchart

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which may then serve as a basis for coding. There are available translation programs which take
a decision table as input, and produce as output a program written a language such as
FORTRAN, COBOL or PUI, or compiled Code. Examples of this are the Rand Corporation's
FORTAB and DBM's decision Log Translator both of which produce FORTRAN programs. The
DET'ADI65 produces a CQBOL program.

The accounts receivable structured example draws heavily fromd1e illustration provided by
Brookes etal one can refer to a large Dumber of problem situations that are amenable to the
process just illustrated. Primarily the analysis would have to understand the problem on hand by
being able to determine a set of operating conditions and the amenable decisions to take by
following the set of alternative rules that can be drawn up.

Decision tables are quite graphical in nature and facilitate communications between user analyst
supervisors and affected parties. As we have seen, the decision table expresses primarily a series
of conditions; when the conditions are fulfilled, then a rule associated with the condition is
executed. A 'header' is used to identify the table and condition stubs describe the various
conditions. As already explained earlier, a rule is a procedure for checking the different
conditions, and the action statement tells what action to take when a rule is true. The table is read
until the conditions for II rule are met and the action described is taken. Then the next scan of the
table begins.

1.3. UNSTRUCTURED DECISIONS

Thus far we have been discussing the structured programmable decisions which are very large in
number and perhaps more easy to handle as compared to the unstructured or relatively less
structured decisions which we would now like to discuss. Though fewer in number as compared
to the structured situations, this category of decisions is more repetitive in nature, usually 'one-
shot' occurrences for which standard responses are usually not available. Hence they require a
creative process of problem solving which is specially tailored to meet the requirement of the
situation on hand. In fad managers at higher levels in an organization are usually faced with
more such unstructured decision making situations. Some have aptly described the situations as
some what strategic in nature as compared to the tactical orientation of the structured decisions at

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the lower levels of management. Strategic decisions are non-repetitive, vital and important and
aim at determining or changing the ends or means of the enterprise.
Since each manager, in the case of such unstructured, non-programmed decisions, may bring his
own personal beliefs, attitudes and. value judgments to bear on the decision process, it is possible
for two managers to reach distinctly different solutions to the same problem, each claiming that
he is acting rationally. In fact the ability to make good non-programmed decisions helps to
distinguish effective managers from ineffective managers. Unstructured decisions are not simple.
They are usually quite complex in nature. We can't shy away from them for someone has to
ultimately make these decisions even though there are inherent dangers when confronting ill-
structured problems. Non-programmed decisions are, essentially new and unique. They have to
be often solved de novo: There is no tried and true method of handling them. Unstructured
decisions are those in which the decision maker must provide judgment, evaluation and insights
into the problem definition.

1.4. ADDITIONAL CATEGORIES

There are many says of categorizing decisions as proposed by various persons from time to time.
We have already discussed structured and unstructured situations. Some have termed them as
programmed/programmable and non-programmed/non-programmable decisions. Yet others have
talked of routine/repetitive and non-routine/non-repetitive decisions.
Some have stated the range of tactical and strategic decisions; others have termed them as minor
and major decisions. We can easily have just two classes of decisions as follows:

Class I: Unstructured, Non-programmable, Strategic, Major, Routine, Repetitive, Complex,

Long-run.
Class II: Structured Programmed tactical, Minor, Non-routine, Non-repetitive, Simple, Short-
run.

1.4.1 Departmental, Inter-departmental and Enterprise Decisions

Let us discuss decisions that could bb departmental, inter-departmental and, enterprise decisions.
For instance, sanctioning leave to an employee is a departmental decision, but making a slight
change in the design of the product is an departmental decision, and entering a new line of

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business is an enterprise decision. The department level decision is strategic in nature whereas
departmental level is tactical in nature.

1.4.2 Organizational and Personal Decisions

When an executive acts formally in his expected role in an organization, he makes organizational
decisions. However, when 1he manager takes a decision in his personal capacity and not as a
member of the organization, it is known as a personal decision. For instance, transfers that are
affected by an executive are organizational decisions. However, an executive who decides to
leave the present organization is making a personal decision.

1.4.3 Individual - Group Decision Making

Decisions may be taken either by an individual or by a group or a Committee. It’s difficult to say
which a better method of taking decisions is. Each method has its strengths and weaknesses. We
are all aware of the delaying tactics that are adopted by institution of committees in the
resolution of conflicts. On the hand, it is argued that two blockheads are better than one, There
would' be richer ideas and many more alternatives generated in the process. But when it rooms to
assessment of selection, there could be 'lot of heat' generated. How does one resolve such a
situation? Is it by consensus? or by voting?

1) Individual Decisions
According to Simon, It is impossible for the behavior of a single is loaded individual to reach
any high degree of rationality. The number of alternatives he must 'explore is so great, the
information he would need to evaluate them so vast, that even an approximation to objective
rationality is hard to conceive. The individual decision maker is an individual human being - the
one factor most vital and most difficult to understand because of various factors such as age
perception emergence experience in a given area, confidence in decision making, time available,
resource position, upbringing, family background and so on that could come in to place. The
most mysterious factor is still this decision making individual human being. The individual
decision maker could have quite an amount of prejudice and bias that is inherent on -account of
perceptual processes which acts as great filters. We only accept what we want to accept and
hence only such information filters down to our senses, and secondly the perception is highly

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subjective. The information gets distorted to coincide with our pre-established beliefs attitudes
and values.
These are additionally cognitive constraints. Psychologically we are always uncomfortable with
decision making. We are never sure if our choice of the alternative was correct and optimum,
until the impact of the implication of the decision has been felt. This makes us feel very insecure'
and could be one of the many causes of 'stress' in individuals' leading to hypertension and other
health complications.

No doubt it is important to have adequate and accurate information about the situation for good
quality decision making. However, it must be recognizes that an individual has constraints of
nature such as physical, Psychological, sociological etc. These limit the amount of information
the individual can handle

ii) Group Decisions

As for group decisions, these are usually taken for major issues in order to secure wider
cooperation acceptability and coordination. Usually in a group like situation, the chances of
subjective errors are reduced and more options are strewn open. If the group is larger such
decisions suffer from unnecessary delays, deadlocks and petty party politics.

Some advantages of group decisions are

i) Increased acceptance by these affected and hence implementation is easier.
ii) Easier Coordination.
iii) Easier Communication
IV) More information processed on account of a9ailabitity of a larger number of specialists in
the group.
v) Group decision making is more democratic in nature
vi) Participative group process builds up a training ground for subordinate and others which
allows for smooth handover When individuals leave the scene (no vacuum is created)

Let us now enlist some of the disadvantages of group decisions

i) Group decisions take longer.

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ii) Groups can be indecisive.
iii) Groups can compromise
iv) Groups can be dominated
v) Group members may exhibit "focus effect" viz., the group may justification one or a few
suggested alternatives and spend all the time in evaluating these and may never come up with
other ideas thus limiting the choices.

1.5 DECISION MAKING PROCESS

1.5.1 Simon’s Decision Making Model
Let us now look at the decision making process as proposed by Herbert A. Simon. His model is a
conceptual framework that divides the decision making process into the following stages or
phases:
i) Intelligence Activities: At this stage, a search of the environment takes place to identify events
and conditions requiring decisions. Data inputs are obtained, processed and examined for clues
that may identify problems or opportunities.
ii) Design Facilities: At this stage, alternative courses of action are developed, analyzed and
evaluated. This involves processes to understand the problem, to generate solutions, and to test
solutions for feasibility.
iii) Choke & Implementation Activities: Here one has to select an alternative as course of action
from those available. A choice is made. Implemented and monitored.
Though intelligence, design, choice and implementation activities are sequential in nature, the
decision making process includes the ability to cycle back to a previous stage as shown in the
following Figure. Choice and implementation have beef shown to be separated for better
understanding.

Is there a. problem! What are the alternatives? Which should you choose? Is the choice
working?

Intelligence Design Choice Implementation

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Figure Flow Chart of decision process

1.5.2 Massie’s Decision Making Model

Many step-wise models of the rational decision making process have been proposed over the
years. One such proposal by Massie has been found to be mast representative as a five stage
procedure as follows:
i) Understand situation
ii) Diagnose and define problem
iii) Find alternatives
iv) Select action and
v) Secure acceptance of decision

1.6 INFORMATION REQUIREMENTS'FOR DIFFERENT DECISION MAKING

STAGES
Let us now look into the information requirements for the various stages described in the earlier
section.
1.6.1 Information for Intelligence Phase
Information Systems can help in the intelligence stage by providing information about external
and internal conditions. Intelligence entails scanning the environment, either intermittently or
continuously, depending on the situation to identify potential decision situations. For example:
a) a marketing executive makes periodic visits to key customers to review possible problems and
identify new customer needs;
b) Sales analysis reports can be furnished to managers periodically, when exceptional sales
situations occur, or on demand. These help managers to identify the status of sales performance.
Also information from market, studies and external, databases could also help managers (at
higher levels) identify changes in consumer preferences or Competitive activity;
c) A design engineer might attend a trade show at the International Trade Fair observe new
materials that mayor could be incorporated in future product designs.
The Intelligence phase and its activities result in some type of dissatisfaction with current state or
alternatively aid in the identification of potential rewards for, a new state. The intelligence phase

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is the tricky phase and embraces the unstructured non-programmed category of decisions that we
have discussed earlier in this unit. Major information, system capability is needed at this stage. It
should be possible provide situation-specific information to managers when they make ad-hoc
inquiries that could be unique and often unscheduled. All this should be in addition to some of
the exception reports that might be churned out on Ii weekly basis.

1.6.2 Informa4ion for the Design Phase

The design 'phase involves -designing of several possible solutions to the problems and
evaluation of the alternate courses of-action. Here more carefully specified and directed
information activities and capabilities focused on specific designs are required. This stage causes
for quite a deal of creativity and innovation. Idea generation and idea engineering could play a
useful role in this stage of decision making. Techniques like Brainstorming, Nominal Group
Technique etc. could be utilized. Here also some decisions might fall in the category of highly
structured, programmed situations and move towards semi structured or unstructured non-
programmed decision situations. We have already discussed the use of decision tables for
structured situations. Decision trees could also be utilized by laying out graphically, the
alternative courses of action that are Within the control of the decision maker and the states of
nature, which are beyond the control of the decision maker.
As for the semi-structured or unstructured decisions, decision support systems (DSS) and expert
systems (BS) can provide assistance to managers. Models of business operations can be
developed witJ1 decision support software, including advanced statistical, management science,
and modeling packages, or less complex spreadsheet programs. These packages and models can
then be used to manipulate information collected in the intelligence stage to develop and evaluate
a variety of alternatives. Thus the information system should contain decision models to process
data and generate alternative solutions. It should assist with checklists, templates of decision
processes, scenarios etc. The models should assist in analyzing the alternatives.

1.6.3 Information for the Choice Phase

In this stage a final selection of a particular course of action has to be made out of the various
alternatives generated in the preceding design stage. Here a manager can use information tools
that can calculate and keep track of the consequences, costs and opportunities provided by each

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alternative designed in the previous stage. Information systems should help managers select a
proper course of action. An information system is most effective if the results of design are
presented in a decision-impelling format. The final choice would depend whether there is a
single criteria or objective on which it is to be decided or whether the decision situation is one
which involves multiple criteria and objectives. Most decision making situations fall under the
multiple criteria category, which is more difficult and complex and operations researchers are
just about going into this field. The manager is hardly an optimizer now; he believes in
satisfying. Worse still, one has to account for factors both subjective arid objectives quantifiable
and non-quantifiable, tangible and intangible. A technique called Analytic Hierarchic Process
(AHP) developed by Saaty is finding a great deal of application in such situations and seems to
be becoming a great boon for decision makers. An 'expert choice' software is available for the
purpose of prioritization of alternatives.

The quality of the choice stag depends very much on the quality of inputs made from the
previous two stages - intelligence and design phases. It is Possible that the manager, even though
at the choice stage, might like to refer and return to the previous stages and reopen the issues for,
more data or alternatives etc.
Information systems can help managers in the choice stage in various ways, Managers can be
provided with summarized and organized information emphasizing major points such as major
options, resource requirements and results of each alterative. Some type of what-if simulation
analysis could be established.

1.6.4. Information for the Implementation Phase

This is the final stage of the decision making process. It is concerned with implementing and
monitoring, when the choice is made in the previous stage the role of the system changes to the
collection of data for further feedback and assessment. The information systems must help
managers monitor the successful implementation of the decision. Here managers can use a
reporting system that delivers routine repeats on the progress of a specific solution. Some of the
difficulties that arise are resource constraints, and possible ameliorating actions. Support systems
can range from full-blown Management Information Systems to much smaller systems and
project planning (PERT/CPM based) software operating on micro-computers.

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Feedback about business operations affected by a decision helps a manager assess the decision's
success or failure, and whether follow-up decisions are needed.

1.7 RATIONAL INDIVIDUAL MODELS OF DECISION MAKING

Because organizations are made up of individuals, it makes sense to build information systems
that facilitate individual decision making, wherever possible. Different 'assumptions have been
made while proposing some model or the other.

1.7.1 Rational Model

Some economists, mathematicians and management experts believe that the decisions are always
made rationally because the decision maker:
 knows his or her objectives and ranks them in order of importance;
 knows all able alternative Solutions to the decision problem;
 knows the relative pros and cons of each alternative; and
 chooses the alternative that maximizes attainment of the objective.
Such idealistic assumptions have their share of criticism. Decision makers are not so well
informed as to consider all the alternatives or to know all consequences. Moreover, it is not just a
singular objective that is pursued in real life situations. Still, despite these criticisms the rational,
model remains a powerful and attractive model of human decision making.

1.7.2 Bounded Rationality and Satisfying

Instead of searching for all of the alternatives and consequences (unlimited rationality) as in the
preceding model, people limit the search process to sequentially ordered alternatives (alternatives
that are not radically different from the current policy. Wherever possible they avoid new,
uncertain alternatives and rely instead on trisect-and-true rule~, standard operating procedures)
and programs. Individuals and/or organizations have multiple goals, some in conflict with each
other. Even goals are prioritized or placed in a hierarchy. In this way rationality is bounded.
Simon proposes the satisfying approach rather than the optimizing approach.

1.7.3 Muddling through Model

In 1959, Lindblom proposed the most radical departure from the rational model in his article on

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the "science of muddling through". He describes method of decision making, as one of
"successive limited comparisons". Here values are chosen at the same time as policies, and no
easy Q1eans-end analysis is possible. For instance labor, and management can rarely agree on
values, but they can agree on specific policy. Because of the limits on human rationality,
Lindblom proposes, 'incremental decision making, or choosing policies most like the previous
policy. Non-incremental policies are apolitical (not1itety to bring agreement among important
groups) and dangerous as nobody knows what they will lead to. Lastly, it is argued that choices
are no "made". Instead decision making involves a continuous process in which final decisions
are always being modified to accommodate changing objectives, environments, value
preferences and policy alternatives provided by decisions makers.

1.7.4 Psychological Types and Frames of Reference

The Psychologists have given an additional perception to the rationality concept. They say that
humans differ in how they maximize their values as well as in using the frame of reference for
interpreting information and making choices. Here we hear about the 'cognitive style' that refers
to underlying personality dispositions in the treatment of information, the selection of
alternatives and the evaluation of consequences. Systematic thinkers impose order on perceptions
and evaluation; intuitive thinkers are more open to unexpected information and use multiple
models and perspectives when evaluating information. Neither is mote rational than the other.
Some studies have found that humans have-a deep seated tendency to avoid risks when seeking
gains but to accept risks in order to avoid losses. In other words, people are more sensitive to
negative outcomes than to positive ones.

1.7.5 Implications of the Models for Information Systems

Decision making is not a simple process and hence some guidelines need be kept in mind when
designing information systems. The following characteristics of information systems could be
encouraged:
- they are flexible and provide many options for handling data and evaluating information.
- they are capable of supporting variety of styles, skills and knowledge:
- They are capable of changing as humans learn and clarify their values.
- they are powerful in the sense of having multiple analytical and intuitive models for the

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evaluation of data and the ability to keep track of many alternatives and consequences.

1.8 ORGANISATIONAL MODELS FOR DECISION MAKING

Just as we discussed rational individual decision making, it is useful to think also of
organizational decision making.

1.9 SUMMARY
Decision making is an essential part of management. Some have even suggested that
management is synonymous with decision making. Managers are decision makers and problem
solvers.
Personally and also for a professional manager, whose main orientation is towards the making of
decisions. There is always an implicit opportunity loss associated with poor decisions.
The 'force' of habit in fact leads to certain traditions conventions and practices which might
become a platform towards formal statement of rules, procedures, policies, etc.
There are available translation programs which take a decision table as input, and produce as
output a program written a language such as FORTRAN, COBOL or PUI, or compiled Code.
Examples of this are the Rand Corporation's FORTAB and DBM's decision Log Translator both
of which produce FORTRAN programs. The DET'ADI65 produces a CQBOL program.
Decision tables are quite graphical in nature and facilitate communications between user analyst
supervisors and affected parties.

1.10. SELF-ASSESSMENT EXERCISES

1. Define structured and unstructured decisions. Give three examples for each.
2. Discuss the rational individual models of decision making. What are the implications of these
models to information system analysts?
3. Describe the organizational choice models. How would the design of systems be affected by
the choice of model employed?

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UNIT TWO
CONCEPTUAL FOUNDATIONS OF
INFORMATION SYSTEMS

Objectives

After going through this unit, you should be able to:

 appreciate the significance of information systems in an organization
 identify the information subsystems which could be defined Within a typical organization
 differentiate between various types and levels of information systems.

Structure

2.1 Introduction
2.2 Information Systems
2.3 Types of Information
2.4 Organization as an Information Processing Unit
2.5 Organizational functional Subsystems
2.6 Activity Subsystems
2.7 MIS and Data Processing
2.8 Operating Elements of Information Systems
2.9. MIS and Top Management
2.10. Structure of Information Systems
2.11 Types of information Systems
2.12 Evaluation of Management Information System
2.13 Summary
2.14 Self-assessment Exercises

2.1 INTRODUCTION
Managers have come to realize that without proper information - at the right time and at the right
place - even the other resources may not be fully utilized. And a fully informed manager is in a

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position to take better decisions as compared to an uninformed one.
It was way back in 1957 that the organizations in the United States passed from the industrial era
to the information era. It was in that year that the number of employees who were primarily
handling information surpassed the number of industrial workers; and this number of information
workers kept on increasing during the 1970s also.

To understand type of information systems, we should define the following concepts in detail. 1)
The present unit discusses various conceptual foundations related to information systems.

2.2 INFORMATION SYSTEMS

A management information system has been defined by Davis & Olson as an integrated user
machine system designed for providing information to support operational control, management
control and decision making situations in an organizations The information systems make use of
resources such as hardware software men, procedures as well as supplies. As the above given
definition indicates, the information Systems are meant for supplying, and .not generating, the
information to various managers involved in the decision making process. The information
systems are expected to provide processed information to the decision makers as various
management levels in different functional areas throughout the organization. To understand the
management information systems, it is possible to define it into three constituent components:
Management: Management has been defined as a process, a function, a profession dealing with
the activity of getting the work done with and through people. The various functions of managers
include directing, controlling, staffing, leading and motivating.
Information: Information could be defined as sets of facts, figures and symbols processed for the
current decision making situation. The information is considered to be of significance in a
particular situation.
System: A system is defined as a set of related components, activities, processes, and human
beings interacting together so as to accomplish some objective. Putting all these three
components together, it could be seen that Management. . Information Systems are sets of related
processes, activities, individuals or entities interacting together to provide processed data to the
individual managers at various levels in different functional areas.

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While defining the Management Information Systems, the following characteristics should Ire
kept in mind:
a) The Management Information Systems are primarily meant for providing information from the
data after processing them. The information systems do not generate data. The data is generated,
collected, recorded, stored, processed and retrieved after it has been generated by business
operations in an organization. The information systems follow the procedures de sighed for
processing this data which has been generated within the organization.
b) The information systems are designed for the job positions rather than for individuals.
Regardless of who is the individual holding the job position, the information systems are
designed keeping in mind the job responsibilities that the individual is supposed to perform and
depends upon the information needs of the individual is the antirational hierarch).
c) The information-systems are designed for different levels of management - they are supposed
to cater to the information needs of decision makers at top, middle and junior levels of
management.
d) The information systems are designed for supplying information to managers in different
functional areas. The information is supplied to managers in the areas of marketing, finance,
production, personnel, materials, logistics, etc.
e) The information systems should be integrated by way of databases. The redundancy in storage
of data, processing of data and generation of reports is avoided by way of integration of
information systems. Single point data entry and updaters of master data files should be ensured
to minimize chances of discrepancies in the data integrity.
f) The information systems are facilitated with electronic equipment such as computers.

2.3 TYPES OF INFORMATION

Broadly information can be divided into two different type internal information and external
'information. Figure 2.1 shows the scope of internal and external information in the context of
business originations.
Internal information: The Internal Information can be defined as the information which has been
generated from the operations of the organization at various management levels in the various

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functional areas. The internal information gets summarized and processed as it goes from junior
most to the topmost levels of management. The internal information always pertains to the
various operational units of the organizations. Examples of Internal Information would be
production figures, sales figures, information on personnel accounts, materials, etc. This is a type
of Conceptual Foundation of information systems.

Planning information related to the External

external environment information
TOP

MIDDLE
Controlling information related to the Internal
JUNIOR internal environment information

2.4. ORGANIZATIONS AS AN INFORMATION PROCESSING UNIT

The information gets processed within an organization as it travels from clerical level to the top
levels of management. The following figure shows how the information gets processed within an
organization.

Data collection Input Processing Output Dissemination

Customers

Competitors Members of the organization

Action Public and shareholders

Operations
Government
Environment
Environment
Government
MIS and Organizations
The various subsystems of any information system could be better understood by looking at it
from the organizations point of view. The two approaches used to define the subsystems of an
MIS are:
(l) Organizational functional subsystems and
(2) Activity subsystems:

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2.5. ORGANISATIONAL FUNCTIONAL SUBSYSTEMS
The following figure clearly shows the various functional areas which could be separated from
the MIS point of view. The major subsystems and the typical reports generated within each
functional area are given as under:
Functional Subsystem Some Typical Reports
Marketing Sales Forecasting Reports, sales planning
Report, Customer and sales Analysis report
Production Production planning and machine loading
reports, cost analysis & control reports, qulity
control report
Materials Goods on order report, vendor analysis report,
Inventory control report, physical inventory
report, ABC/XYZ analysis reports
Personnel Personnel information reports, performance
appraisal reports, Training & level records
Finance and Accounting General Accounting reports, payroll
Accounting reports, Bonus & IT reports

2.6 ACTIVITY SUBSYSTEMS

The information subsystems could also be understood by looking at the subsystem - from activity
point of view. In each functional area, the processing' activity could be done at four different
levels. These levels are handled by different -levels of manpower within the organization. For
example the transaction processing activity is usually looked after by the clerical appearing
personnel, whereas the operational control activity is the responsibility of major levels of
management. The management control and strategic planning functions are direct responsibilities
of middle and top levels of management respectively. The following table shows the typical user
prude for these activity subsystems.

Activity Subsystem Typical Users

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Transaction processing Clerical Staff
Operational control junior level managers
Management control Middle level managers
Strategic planning Top level managers

2.7. MIS AND DATA PROCESSING

MIS can be differentiated from data processing from the users point of view. Historically, the
data processing was the first sub system to be used in business organizations. It is recently that
the data processing is being treated as a lower level activity as compared to MIS. Data
processing is basically aimed at processing of transactions generated from day-to-day operations
within an organization: whereas MIS aims at supplying information from the processed data to
various addresses of management to support their decision making process. The use of-
computers for processing o€ data actually started with data producing: MIS has evolved only
recently within the organizations. Data processing could be further divided into four different
streams as given below:

a) Office Automation Systems (OAS)

The Office Automation Systems are those activities and processes which are undertaken on the
computer to perform the office routines such as routine correspondence scheduling
appointments, calendar functions bulk mail, word processing etc. However, it may be noted, that
AS does not lead to generation of data directly. These systems are designed following basic
principles of Office Management.

b) Transaction Processing Systems (TPS)

The transactions which get generated on a day-to-day basis in an organization are collected
stored arid used for updating master data files so as to change the -current status of
organizational entities within an organization. The Transaction Processing Systems are primarily
aimed at updating the history files; generation of detailed transaction reports and preparing
summarized processed transaction data. Examples of Transaction Processing Systems are sales
accounting systems, financial accounting systems, personnel accounting systems, etc. All these
systems are designed following the basic principles of accounting.

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c) Management Information Systems (MIS)
These systems are designed for providing information to the key functionaries in an organization.
These systems make use of the already processed transaction data which is outputted from TPS
and generate information reports after processing data. The examples of this kind of systems
could be personnel information systems, marketing, information system, sales information
systems, production arid operations systems, etc. These systems are designed following the
principles of organizational theory. The major group of users- for this kind of systems is the
middle levels of management.

d) Decision Support Systems (DSS)

DSS are the highest order of systems among the computer based information systems. These
systems make use of the summarized organizational data as well as external data collected from
the environment of the organization. The internal data is mostly used for studying the trends
whereas external data is mostly used for understanding the environment. These systems also
make use of analytical and planning models such as management science and operations research
models. These systems arc mostly used for as listing the top management in taking unstructured
and semi-structured decisions having long-term impact on the organizational performance.
2.8 OPERATING ELEMENTS OF INFORMATION SYSTEMS
Any information sysl9ffi will make use of the following physical components:
a) Hardware: The equipment and devices for inputting, outputting, secondary storage, processing
as well as communications in the system.
b) Software: The set of programmers to facilitate processing procedures; it includes systems
software, applications software and the model base.
c) Data Base: The organizational data to be used by various software programs is usually stored
in the firm of files and database on the physical storage media such as computer tapes: disc
drives, floppy diskettes.
d) Procedures: The operating procedures documented in the form of physical, manuals constitute
an important part of MIS components. These documents could be divided into three major types:
Operating Manuals, User Manuals, and Systems Manuals.
e) Operating Personnel: The ma6power operating these information systems include systems

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managers, systems analysts, data administrators, programmers, data entry kind computer
operators.

Processing Functions
The major processing functions in information systems include the following:
a) Processing of business transactions: To capture, collect, record store and process the events of
business interest, so that their effect should be carried over to the organizational performance
records.
b) Updating of master files: The effect of these transactions is carried over to the status files of
the organizational performance. Master files at any given time shall reflect the status of any
entity after having incorporated the impact of up-to-moment transactions.
c) Generation of information reports: After having processed the transactions and updating of
master files, the information reports are' generated so as to assist the managers in their decision
making.
d) Processing of interactive enquiries: On-line information processing systems provide the
facility of responding to the business queries raised by the managers on the data files - both
military as well as transaction files.
e) Providing interactive analytic support: The key decision makers not only need to interact with
the data files for extracting data, with the help of scientific and planning models, they also
require on-line processing support to analyze, the impact of some possible actions. When the
system is able to extract data from relevant files and address this to the models chosen by the
user, this leads .to a Decision Support System.
2.9 MIS AND TOP MANAGEMENT
In order to relate the information systems to the corporate strategy in an organization, it becomes
important that the top management should take keen interest in the development and
implementation of information systems. More often than not, it has been found that the tap
management does not take keen interest in the development of structured, formalized and public
information systems. The key managers normally tend to depend upon their informally designed
private information systems. It is necessary that, far successful implementation of information
systems in an organization, a corporate plan should be prepared covering a period of 5 to 10
years far the organization. The components of corporate plan should include a mechanism far

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implementation, proposed organizational structure and changes order a period of time,
applications to be computerized issues relating to operations management, procurement of
equipments and training of staff and effective control of information system function. Figure 2.5
shows the information systems strategic grid suggested by McFarland and McKinney. This grid
arrays a firm's existing applications against the applications which are currently under
development.
Low

Strategic impact
of existing Support Turnaround

applications

Factory Strategic

High 1.5: Information system Strategic Grid

It could be noted that the companies belonging to the strategic cell need to look after their
processing activity mare carefully whereas in turnaround cell the companies might be able to
convert their processing function as a major competitive weapon. In the factory setting there is
not much to plan, yet the existing applications should be estimated.

2.10 STRUCTURE OF INFORMA TION SYSTEMS

The MIS structure could be discussed in terms of support far decision making, management
activities and organizational functions. A conceptual framework would Shaw die synthesis of
these three approaches into an MIS structure; the structure could be understood by looking at the
conceptual structure and the physical structure.

The Conceptual structure of Information System

The conceptual structure could be defined as an integrated system of functional subsystems each
one of which could be divided interferer different information processing components (1)
transaction processing system; (2) operational control information system, (3) managerial control

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information system and (4) strategic planning information system. Each of the functional
subsystems in the organization will have unique data files required frank particular subsystem, as
well as each of the subsystems will also make use of general database files which can be
accessed by more than one subsystem. The Concept of database which is common to more than
one functional area is called a general database and is managed with the help of a database
management system. A micro view of the MIS structure would also show the presence of the
software programs in addition to the specific programs which are de1leloped for each functional
area. The MIS also makes use of a model base primarily meant for MIS reporting and decision
support systems. The model base and common application software is common to a range of
applications within and across the functional areas. Figure 2.6 shows the conceptual structure of
an information system for a function. When application software for top management, middle
management, junior management and clerical function are put together, along with the common
application software, it becomes a complete conceptual structure of an information system.

The Physical Structure

'It is quite similar to the conceptual structure except that there is lot of integrated processing and
it makes use of common modular software .The integration of information systems takes place
through database which is normally a common database. The various subsystems and different
functions interact with each other through the database. The outputs of one subsystem are stored
in the common database which is subsequently used by the next subsystem as inputs. This is how
the. Integration of information processing activity takes place across the various subsystems. To
reduce: duplication of efforts for development .and maintenance of software as the common
modules of application software are also used across the' various functional areas. These
modules cross the functional boundaries and are useful in more, than one function. These
modules are either inserted into the system or called in by the system.

2.11 TYPES OF INFORMATION SYSTEMS

The information systems' usually belong to two different types Le: structured and unstructured
information systems. Formalization and publication of information leads to structured ness in
information .processing activity; whereas absence of these two leads to unstucturdness of
information systems. Figure 2.7 shows the various information system components in an

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organization. It could be seen from the figure that public information system are designed to
provide the organizational information to the authorized persons in the organization vote
systems, on the contrary, are designed to, unit the availability of the information to the select
individuals. Normally, the private information systems are meant for supplementing or
duplicating the efforts of public information systems. The public information systems are
characterized by the presence of formal documents and records whereas the informal information
systems mayor may not have any recounting or redesigned process of retrieval.
Public Private

Formal

Informal

Figure 2.7: information system components

The information systems could also be characterized as formal and informal. Formal information
systems are those which follow the hierarchical structure of the organization. The information
system where all those who are using information are authorized to use it and are also
responsible for dissemination of specific information is called formal information system
whereas information systems where unauthorized people pass on the public or private
information from one level to another level are called informal systems. In informal systems the
user as well as sender mayor may not be authorized users; It could be seen that-when the
information systems are formalized and they are developed for handling of public information
they become more and more structured with predefined frequency content source and objective;
whereas absence of predefined frequency, content, source as well as justification leads to
unstructured information systems. With computerization of information systems, more and more
structured ness is achieved and the information system components are affected as shown in
Figure 2.8.

Public

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Formal

Informal

Figure 2.8: Impact or Computerization on MIS Components

2.12 EVALUATION OF MANAGEMENT INFO~ATION SYSTEM

Introduction
Computerized information systems are developed and utilized by two categories of
organizations: (a) firms which have the in-house capability and (b) service-bureaus which
develop them for use by the outside clients. In both cases, the basic investments life of a high
order in. terms of not merely the computer system, but also site preparation involving air-
conditioning, civil and electrical works followed by recruitment of manpower (computer centre
manager, system analysts, programmers and operators, besides input/output, quality Control,
data preparation and other support staff) and their training. There can be only one objective
behind making such sizeable investments and that is to provide satisfaction to the end-user in-
house or outside.

Systems Cost
Design development and implementation of computerized information systems are done deeding
the above aim in view. In must cost-conscious organizations, an initial estimate is prepared for
the one time cost of developing the system and the recurring costs of running the system. The
cost estimation has to covers details as: routine manpower (systems, programming, operations
and. for service-area, marketing staff); manual manpower (specially employed to handle
production, quality Control, correction of checklists etc.); data preparation (direct entry or 'punch
entry or punch-card kind. whether done in-house or by outside agencies), consumable stores
(stationery, cards or floppy disks. carbon, ribbons, etc.); computer time actual usage hours. After
it is logged by the computer itself,administrative expenses logistic expenses (for conveyance of

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manpower transportation of documents or output reports, etc.); and miscellaneous expenses
(overtime. etc.).
For a service bureau fair basis to know if the computer is paying for itself in terms of the cost-
estimate for usage per hour can be the cost of a computerized system is chargeable to the outside
client and the latter's acceptance of the billed money, (without asking for cancellation of billed
computer time, etc.) can be a good yardstick to know if the client has turned out to be satisfied or
not.

Need for Evaluation

Whether or not service bureaus face their irate customers, or user organizations meet their
dissatisfied departmental heads, a sound principle to run computerized information systems is to
introduce, side by side, a reliable procedure for management of hardware software and tatter
preparation. Such practices as regular and time-bound spares and consents do help hardware
management. Attention to programming capability,) scientific design and development of
systems and a high-quality support for system software is invaluable for software management.
Data preparation is a weak link in most organizations and quality control of entered data is a
must, among other factors.
An actual evaluation plan has to begin from the stage when one knows what has been spent on a
computerized information system (through first estimating and after assessing the actual cost on
a monthly basis as outlined above), and then proceed to find out if there has been value for
money spend Such an evaluation is certainly not easy and can be approached in a two-fold
manner: from the process side of system evaluation and from the product side of output reports.

Process Evaluation
A process evaluation is carried out from the computer professional point of view. Design of the
system and the quality of programmings have to stand rigors of careful assessment. Quite often
the system design is presented by the project leader to the entire application Software group and
gains from their friendly criticism. Programming standards are today quite high and a modular
approach is far preferable to single integrated programs. Internal or external training in efficient
program-writing techniques can achieve surprisingly good results.
Another aspect of process evaluation is the utilization of hardware resources. In all computes

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capable of running multiple programs', there, should be adequate prior consideration to arrive at
different memory partitions and to allocate input-output devices in a judicious way to partition,
The allocation of certain tapes or discs to production are development jobs often helps in
obtaining an efficient and steady mix of jobs. The test for evaluation is to ensure optimal system
utilization, with the least possible idleness of any single device.

The third aspect of process evaluation is to check whether there is minimum wastage of
computer-time. It my happen that well designed systems with good quality programs are running
with an apparently maximum use of hardware resources, and still they may hide many wasteful
runs. This arises due to two reasons associated with development and production stages of the
information system. At the development stage, lack of rigorous quality control may allow may
avoidable runs of the programs. At the production stage, lack of full-scale debu3gingmay make
some programs prone to repeated runs. In fact; the best relevant-check is to lay down permissible
number of developmental runs and ensure fitness of the programs for release for production runs
without wasting system resources.

Product Evaluation
The product evaluation is concerned with the end-user and has to ensure that the output reports
(which were developed to generate the information system in the first place) are of acceptable
quality and continue to be of use. Instances are not rare that computer outputs, which have long
fallen out of use, are not pointed out as such by user-managers out of deference to the higher-
level policy of computerization, while the managers continue to use their little pocket-books
containing relevant data. To avoid such it possibility, organizations having a fairly long tradition
of computer-based information systems should once in a while, take stock of the existing
mechanization.

One way this was done at Tata Steel sometime back was to devise a questionnaire for each user-
department, outlining the group of computer applications for them. General questions related to
the usefulness, quality level and achievement of promised improvement, and responses ~ere
sought on a three-tier basis. Specific questions were also framed regarding the reported items of
information, frequency of reports, nature of formats and reporting levels. The purpose of the

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questionnaire was to elicit frank response from the user-managers on the utility of the prevailing
computerized information systems.

The replies received were then tabulated and put up to the higher management for evaluation of
each computerized system from three angles: should the system be continued as such? Or, should
the system be curtailed or even replaced altogether by other more useful system? Or should the
system be modified to cover more ground 50 that its utility is enhanced?
The results of such introspection are not always as per expectations, as managers do not feel
comfortable to answer such questions, or, the questions themselves are
. . not formulated clearly or followed up persuasively. These considerations, however, do not
belittle their usefulness. In another forum provided by the public sector enterprise Hindustan
Zinc the general feeling was that a three-year interval from the time of introducing large-scale
computer based information systems could be about right to raise such searching questions and
to seek answers about the utility of the computerized systems.

Conclusion
In any scheme of evaluation, pertinent attention needs to be paid' to data integrity. It should be
kept in mind that capture of data from input documents and the transition through more than one
medium (say cards and tapes) are error-prone. How good an information system is quite often
depends on how "clean" the data is. Computer-based validation techniques for accuracy,
completeness consistency logical balance and homogeneity of data arc well-proven and are an
essential step to negate a garbage-in, garbage-out situation, The number of errors brought out in
the checklist during the editing stage of data (i.e. prior to running the main processing job) IS
quite often a measure of the dependability of the basic data. Process evaluation .and product,
evaluation have both to follow considerations of data integrity for any information system.
2.13 SUMMARY
The unit defines the information system as an organizational system designed for the purpose of
providing information to various managers in different functional ideas so as to assist them in
decision making. The internal information, which is mainly generated from the operations of the
organization, is, consumed by lower level managers. Summarized internal and environmental
information is used by the senior managers for long-term perspective: planning. The

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organizational information systems could be studied by looking at these from the functional
viewpoint as well as from the managerial activity level. The top management interest for
positioning of information processing activity has been considered important for proper use of
the information resources. The information systems in an organization vary from totally
structured to totally unstructured systems. However, they necessarily consist of physical
components such as hardware, software, manuals and men.

2.14 SELF -ASSESSMENT EXERCISES

1) What is the role played by business information in an organization?

2) Define Management Information System and discuss various characteristics expected of a
good MIS.
3) "Internal information is used for day-to-day decision making whereas external information is
crucial for long-term planning comment.
4) The way organizations cannot exist without MIS, even information does not exist without
organization. Discuss.
5) What are the typical functional information subsystems in an organization? 6). Differentiate
between physical structure and the conceptual structure of information systems.
7) What is the implicit of computerization of the structured ness of MIS?
UNIT THREE
INFORMATION RESOURCES
MANAGEMENT

Objectives
After going through this unit, a student should be able to:
 Understand the growth procC6ses related to MIS function in an organization;
 Relate the issues concerned with Information Resource Management in the organizations
with available frameworks.

Structure
3.1 Introduction
3.2 Information and the Organization

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3.3 Functional-Nomenclature
3.4 MIS Growth
3.5 Strategic Planning for MIS
3.6 Top Management Interest and a Corporate-MIS Plan
3.7 Information Requirements Analysis
3.8 Critical Success Factor (CSF) Method
3.9 Resource Allocation
3.10 Charging for Services
3.11 Information Resource Assessment
3.12 Management Steering Committees
3.13 Location of MIS Function in Organization
3.14 The Future
3.15 Summary
3.16 Self-assessment Exercises

3.1 INTRODUCTION
Information has already been recognized as one of the crucial corporate resources and that it
needs to produce more information available to a wider array of users. is being realized in the
recent years; The investors need information about the financial position of the company and the
vendors, and the creditors need information on the financial health of the organization before
extending any credit facility to the organization. The Government agencies need information
national planning and industry control. The organizations have long since realized the need for
the availability of information resource for the interested groups as well as individuals.

The corporate look for the MIS function has undergone a major change. The management of
information resource has also been subjected to a lot of thinking and the organizations have been
made to think seriously about the growth and development of this function as an independent
support function rather than as part of a major function such as finance and accounting. Serious
thought bas been given to the involvement of the users in the information processing activity, as
well as, to the conversion of the function to a profit centre by developing and implementing,
charge-out systems for the services rendered to the user groups.

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To develop an understanding about the information resource management in organizations and
their related issues, the present study discusses various concepts related to the information
systems management.

3.2 INFORMATIONAND THE ORGANISATION

The organizational factors play major role in what type of information is to be processed and
communicated to the decision-makers. These factors include nature of the organization category
of the organization structure of the organization size of the organization and the management
style followed in the organization. Information is the primary tool that will help the management,
its products and services in the competitive environment. It should be clearly understood that the
information technology and quality information are not the goals but merely the competitive,
weapons that support the organizations in their .activities without quality information
organization are operating in a world of uncertainty, and quality information could be produced
by taking a muffler of steps and making such that the information generated and presented to the
decision-makers is ac Curate, timely and relevant.

3.3 FUNCTIONAL NOMENCLATURE

There has been a subtle but definite shift in the way the MIS function is looked upon in
organizations. This change is characterized by the change in the nomenclature of the titles under
which the function exists in various organizations. Initially, the executive looking after the
function of data processing with the help of the computer was referred to as the computer
manager, and, in the sixties the same position was renamed as Electronic Data Processing
Manager. During this period the department was also named as the EDP Department. It is during
the seventies and eighties that the functions have been recognized as MIS function and the
manager is called the MIS Manager. There are other titles also given to the information
processing function. Some of the e6mmon ones are Management Services Division, Corporate
Services Division and Information Resource Management.

3.4 MIS GROWTH

Growth of the MIS activity in an organization could be studied best by applying the model

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developed by Richard Nolan in 1979, popularly known as the Stage Growth Hypothesis. This
six-stage model very clearly explains the stage by stage development of the MIS function in an
organization. This model provides Ii framework for the analyst to understand the reasons for
success or failure of the MIS function in an organization and also assists in developing solutions
to take the functions ahead. According to this model, there are distinctive features associated
with each and every stage of the growth of the MIS functions in an organization from which the
decision-makers can understand the growth pattern and use the MIS function to the strategic
advantage of the organization. Figure 3.1 depicts the framework suggested by Nolan. In this
figure, the horizontal axis shows the stages of growth and the vertical axis shows the growth
processes of the MIS function. The curve on the graph shows the trend of the MIS budgets. It
could be noted that the budget curve shows an upward trend/till the third stage, and becomes
more level towards the beginning of the fifth stage onwards. The different stages discussed in the
model are as under:

Stage 1: Initialization
The first time the organization buys and installs a computer system, the MIS function in the
organization has entered this phase. Since most media and large-sized companies have
installations of the computer systems the stage is already reached at as the majority of the
organizations are concerned. During this stage the following features may be distinctive.

a) Functional cost reduction applications;

b) Specialist DP organization for technological learning,
c) Luck of strict planning and control in the MIS function;
d) Hands-Of training for user awareness.

Growth Processes

Application Portfolio

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D P Organization

D P Planning and control

User Awareness

DP Expenditure
State 1 Stage 2 Stage 3 Stage 4 Stage 5 Stage 6
Initiation Contagion Control Integration. Data Admn
Maturity
Figure 3.1. Nolan six stage growth model

Stage 2: Contagion
The second stage involves a rapid proliferation of the computer resource all Over the
organization, sometimes based on the actual organizational needs and sometimes just to add
some equipment to feel important in the organization. This is the false when most of the
organizational units feel that they should have an access to the computer hardware, develop
software and have the trained manpower working in their units. Every unit head wishes to have
some computer resource controlled exclusively by himself. Due to that non-planned
proliferation, the MIS function grows disproportionately and, there is, absolutely no control on
the MIS budgets resulting in confusion in the organization. The budgets go shooting up without
any controls. The applications are developed in an independent manner, and this results in
duplicated efforts and systems. This stage is marked by, the following characteristics:
a) Proliferation of applications,
b) User-oriented departmental programmers,
c) More relaxed planning and control of MIS function,
d) Users are superficially enthusiastic without sincere involvement.

Stage - 3: Control
It is towards the end of the second stage that the management gets conscious of the fact that the
benefits being derived are not in proportion to the actual expenditure on the MIS activity, and the
organization starts exercising controls and some restraint in sanctioning the budgets. The

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management takes serious interest in planning the function, and it results in a better control on
the activity. The MIS budgets get checked with the result that the users also get aware of the fact
that information technology should be used to some meaning rather than just having some
Infrastructure Under them. The major highlights of this stage are:

a) Up gradation of the documentation and modification of existing applications,

b) Middle level management to look after the MIS function,
c) Formalized planning and control of MIS function,
d) Users are involved with some accountability imposed on them.

Stage - 4: Integration
After the management has been able to provide the control guidelines to the MIS function, the
organization starts thinking in terms of integrated applications so as to avoid the duplication of
efforts and systems, as well as providing better levels of integrity to the systems and data. Data-
based systems are used and the applications are designed as subsystems of the organizational
system, unlike the earlier .ones. The inter-functional and intra-functional integration is ensured
through the database. Capable database management systems are false to manage the data, and
the data communication facilities are used to transfer data from one location to another. The
budgets, once again start looking hip. This stage is marked by the following characteristics:
a) Retrofitting the existing applications using data base technology,
b) Establishing the computer utility and the user accounts teams,
c) Tailor-made planning and control systems,
d) The user accountability to learn and involve in the systems.

Stage – 5: Data Administration

With the integration of the applications using a data base environment in the fourth stage the
MIS function in the organization undergoes a major change in the functional outlook technical
expertise looses over to the management process and responsiveness to the users, and the data,
becomes the most crucial resource in the organization to be managed. Since the data is being
stored, used, manipulated and processed from integrated files in the database, the function of the
database administrator to plan supervise, provide, control and secure the data becomes most

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important. The stage is characterized by the following features:
a) The applications are further integrated as per the organizational requirements,
b) The data-processing organization is for the data administration,
c) The systems are based on data and system sharing basis,
d) The user becomes effectively accountable for the MIS systems.

State - 6: Maturity
It is almost impossible to attain the sixth stage of maturity when everything has been achieved,
and the MIS systems will never fail themselves or fail the organizations. The applications by this
stage have been incorporated into the organizational functioning and these are as per the strategic
requirements of the organization. The technology has become an integral part of the
organizational thinking, philosophy and systems. Some of the major features related to this stage
are:
a) Integration of applications mirrors the organizational strategic choices,
b) The emphasis is on the data resource management rather than on the system management,
c) Data resource has become the key factor in strategic planning,
d) The user and data-processing professionals Share the responsibility of the MIS function,
jointly and willingly.

It is towards the end of a third stage that the information technology becomes a turning point for
the strategic performs of the organization and the full benefits of the information technology are
realized by the organization Some of the organizations are able to go beyond this point, but
some, organizations may never reach this point at all. Such organizations can never have the
advantages of the technology, and may find it, difficult to survive in the competitive
environment.

3.5 STRATEGIC PLANNING FOR MIS

Planning of the MIS effort is very crucial for organizations. Absence of proper planning may
result in the sky-rocketing of MIS budgets, the leading to a resources crunch during the later
stags of MIS growth. In the initial stages, the application development projects and operations of
completed application systems are the focus of the planning efforts. As the MIS activities grow

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in an organi$8tion, the planning Shifts its attention from operational planning to strategic
planning. For operational planning of MIS, common techniques such as structural flow charting,
structured programming and walk through are used. For managerial and strategic planning of
MIS formation of steering committees composed of key executives from the user and MIS
groups is a common practice. These steering committees are generally created to monitor proper
functioning of MIS activity towards the achievement of long term organizational goals
Organizations commonly face the following problems in MIS planning:
a) The MIS plan may not be compatible with the overall strategies and objectives of the
organization,
b) The framework of MIS structure may be difficult to design,
c) Allocations of development resources to various applications may be difficult
d) Project management, to control time and cost schedules, may be lacking.
The overall objectives of planning for MIS have changed from linking processing strategy with
business strategy in 19705 to linking the information technology strategy with the business
strategy in 19805.

3.6 TOP MANAGEMENT INTEREST AND A. CORPORATE MIS PLAN

For successful growth of the MIS activities in any organization the top management continuous
interest as well as involvement is crucial. Namely that the top management should be involved in
computerization it should also insist on having a corporate plan for MIS activities. The top
management involvement could he in the following areas:
- Provide appropriate infrastructural facility.
- Linking with business .activities.
- Monitor the level of user awareness and understanding.
- Making strategies understood among users.
- Monitoring the financial/capital-requirements of all application areas on a time frame basis.
- Provide flexibility for future designs.
- Review major system changes.
- Establish overall schedules for implementation.

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One of the greatest hurdles to using information technology for strategic purposes has been
inability of the top management to appreciate and manage the information systems. Mostly it has
been due to lack of understanding on part of the top management and a fear of uncontrollability
of information systems which leads to a lower level of interest.

Corporate
Systems plan

Organization
structure

Operations

Application

Equipment
and staff
Needs

Charging Control

Figure 3.2 Framework for managing IR (Information Resource)

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3.7 INFORMATION REQUIREMENTS ANALYSIS
Once the overall MIS goals and strategy have been laid down the next stage is to ascertain
organizational information requirements. Information requirements are vital for MIS planning
application identification and planning information architecture: Three levels at which the
information requirements need to be established for designed implementation of CBIS have been
identified
-organization level to define the overall information system and to specify a portfolio of
applications and data bases
- Database level to specify data models and other predications.
- Traditional approaches adopted by system analysts to assess information requirements are as
follows:
a) Asking questions from the users by available methods.
b) Deriving from an existing system, or from descriptions in textbooks hand books.
c) By object system analysis,
d) Experimentation with an evolving information system.

3.8 CRITICAL SUCCESS FACTOR (CSF) METHOD

John F. Rockart, while advocating the "CSF:' approach, evaluated the existing four methods of
determining executive information needs, viz. by producing technique, the null approach, the
key indicator system and the total study process.
These four techniques have their relative merits and demerits, and to overcome the
disadvantages, the Research Team at Sloan School of Management, suggested a creative
approach termed as CSF approach for information requirement analysis. Its application was
found effective and response-provoking amongst the executives. As a part of the exercise, the
executive goals and the CSFs are identified and reviewed to the satisfaction of both the
executives and the system analysts.

The CSFs for any business are the limited number of areas in which results, if they are
satisfactory, will ensure successful competitive performance for the organization. These are a
few areas where the things "must go right", for the business to flourish. The cSFs must receive
constant and consistent attention from the management as well as individual managers. CSFs

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differ from company-to company and from manager to manager and like organizations may have
differing CSFs. 'There are four prime sources for identifying the CSFs as listed below:
- Structure of the particular industry,
- Competitive strategy, industry position and geographical location of the company,
- Environmental factors,
- Temporal organizational factors needing immediate attention.
The CSFs are generally not meant for strategic planning; since the data requirements are
impossible to pre-plan. The CSf method centers around information needs for management
control where data requirements could be defined and pre-planned. Most executives have four to
eight CSFs.

3.9 RESOURCE ALLOCATION

Allocation of resources is one of the important issues related to the MIS function in an
organization. It is during this stage that we priorities the applications and decide on their
implementation schedule. The following four factors should be kept in mind while allocating
resources to different applications:
- Quantifiable returns,
- Judgmental benefits,
- Institutional factors or constraints,
- System priority factors.
Intangible benefits such as improved levels of service, better financial control standardization
and better quality of information are alsocolis1dered important while considering resource
allocation.

3.10 CHARGING FOR SERVICE

It is an accounting approach for allocating costs of information systems to their users. There are
two different ways of charging the users for the information services:
- Charging by allocation of costs to the users as corporate overhead, and
- Charging for services the individual users get.
The second approach is based on the user's willingness to buy the information services and

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willingness to pay for the new system development.
The reasons for having a charge-out system include cost assignment control incentives and
budgeting. The different techniques which are used for allocating costs are:
i) No charge-out,
ii) Complete Charge-out,
iii) Partial Charge-out.

3.11 INFORMATION RESOURCE ASSESSMENT

The lower arrow in Figure 3.3 represents Information Resource Assessment; (IRA) a process of
using information and knowledge to support the development of the organization’s strategic
business direction. In effect, it is the mirror image of strategic Planning for Information Resource
in the sense that it is the process through which information and knowledge are used to identify
the strategic comparative advantages and to create and evaluate new strategies, i.e., to influence
change in the organizational Strategy Set.

IR strategy Set
Organizational/ Strategy Role of information and IS in the
organization
set Strategic IR mission
Organizational Mission planning of IR IR objectives
IS design-development strategies
Organizational Objectives Information Accusation plan model
Organizational development plan

Comparative Implementation
Advantages
Information Resource
Information & Decision
Organizational Strategies Assessment support System
Other strategic Attributes Database
Model base

Figure 3.3 Operational zing Information as a Strategic Resources

Figure 3.3 shows that this influence does not come directly from the Information Resource (IR)
Strategy set, but rather from. The Information Systems (IS) databases arid model-bases that have
been created to implement the IR Strategy set.

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The basic IRA process is one of identifying information that is crucial, or potentially crucial, to
the organization’s strategy set. This may be of the nature of “new" information that bas not
previously been used to advantage, or it may be information that has been reevaluated and
updated. Such information and knowledge may be put to Use in creating information products or
in developing new and more effective business strategies, objectives, or organizational missions.
One variety of IRA influences the creation of information that is available to the firm through its
IS.

However, the creation of information products is only one of the ways in which information can
be made to be a strategic resource; King and Oeland, (1978) have developed a. technique of
'strategic databases that may be used to illustrate the way in which IRA can be conducted. The
basic idea is that much of the data on which the organization’s strategy may be based is often
routinely collected and analyzed as data rather than as strategic 'information'. The distinction
between data and information may appear to be pedantic but it is a useful one to be made in this
instance.
Data are the numbers, letters and' other symbols that are used to represent events, activities,
entities, etc. (The best-known set of organized data may be the telephone directory.) Information
is data that has been evaluated or some use or purpose. (For instance, a name and photo number
on a message that says that your offer to purchase a house has been accepted is information
rather than data.)

Information is clearly required for the effective support of strategic planning and for the making
of good decision in an organization. Yet, many of the processes that are directed towards
decision-support utilize and present data rather than information.
Illustrative of this, are the strength-weakness assessments that are frequently made by a firm in
support of its strategic decision-making and planning. Most concepts of strategic management
and planning incorporate strength-weakness assessment as an important determinant of strategy.
According to these concepts, the firm should base its future strategy on its primary strengths and
avoid basing strategy, even implicitly on weakness.
To implement this concept, many fills charge staff planners with doing a 'staff study' of strengths
and weaknesses. The predictable results of such a study, is often a voluminous report, that more

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represents data than information.
The same is true in other areas of critical information that are essential to the development of an
effective business strategy. Environmental opportunities and risk~ are routinely assessed and
reported in the form of voluminous data that are not easy to use in. the strategy-making process.
Indeed, it may be argued, that such reports are not realistically be directly used in strategy
formulation and assessment. Formal models may be well used, in providing such strategic
decision support. For instance, models may automatically review companies for their 'acquisition
potential' -the degree to which their acquisition would serve to enhance the goals of the firm,:
However, the effective use of such models requires the input of criteria that can only be
generated by the organization’s managers.
These acquisition criteria, like strength and weaknesses, environmental opportunities, and a
variety of other strategic information must be developed through the organizational processes
that are here-termed as 'IRA'. The strategic data bases represent one way to implement IRA.
They are concise statements of the most significant strategic parameters that will guide the use of
the models that are IS the IS and their application to the development of Strategy. A set of
criteria to be used in the evaluation of the acquisition of the candidates is a strategic database
(SDB), if ii is developed through an organizational process that ensures that the different points
of view of the managers of various functions and product-market groups have been taken into
account, that there is a reasonable degree of organizational consensus concerning it, and that it is
accepted by the organization’s managers. So too may a concise list of organizational strengths
and weaknesses be a strategic database, if it has the same characteristics.

To illustrate this, consider, for example, the traditional process that might be used in an
organization to conduct a strength-weakness assessment. This approach commonly relies on staff
analysts; who gather data and prepare documents which are to serve as background information
for the support of planning activities and strategic choices. Because the planners and analysts,
who perform these tasks, often have neither the managerial expertise nor the authority to make
the significant choices that are involved in any information evaluation process, the typical output
of such an exercise is a document, which seems to have been prepared on the basis of not leaving
anything out such an emphasis on ensuring that nothing relevant is omitted rather than on
attempting to distinguish the most strategically relevant information from the mass of the less

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relevant serves only to perpetuate to existing state of affairs regarding the informational support
provided to managers at an levels: of executives and planners are deluged with irrelevant
information, while, at the same time, they are unable to find the elements of information which
are crucial to the-identification of comparative advantages and to the determination of strategy.
The 'strategic database' approach to implementing IRA, On the Other hand, involves the
institutionp1isatiooof ongoing processes in which basic forces, each-of which is made up of
managers representing various of the parochial interests, within the organization, are charged
with gathering and evaluating the data in strategic areas, such as, strength-weakness analysis,
acquisitions criteria, etc. In effect, these task forces use the information resources of the
organization to change and up-state its organizational strategy set. Such 'strategic databases'
produce and represent information in its most valuable form rather than data since, in this
process large quantities of data have been evaluated and condensed to dorm which can be
feasibly used in the direct support of strategic decision-making.
The strength-weakness, SDB, may be used as an illustration. A task force composed of key
managers in each of the major functional and product sub-units of the organization, is charged
with developing of the most important
This team of managers, supported by their static is charged with arriving at CGD design
concerning a specified approximate number (usually from 10 to 15) of the most important
strengths and weaknesses which should influence the future of the organization.
The development of conclusions on the 10 to 15 most important organizational strengths and
weaknesses can be as any experienced manager knows, a difficult task, when it involves
managers representing various organizational interests and points of view developing a twenty
page list of strengths and weaknesses could be accomplished relatively easily, but a list of the
most significant ones requires substantial analysis, debate and negotiation among the various
individuals and interest areas that are involved. This is so both because of the judgments which
are needed the potential organizational impact which such a list will inevitably have as it is used
in the development of strategy.

3.12 MANAGEMENT STEERING COMMITTEES

Due to active involvement of human beings, organizational powers, needed and politic in the
functioning of the MIS department, a steering committee compared of senior personnel from

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various user groups, such as, the finance and EDP function proves to be a better alternative to
prepare the priority list for allocation of resources. Though this method also suffers from major
disadvantages, such as, the time wasted on meetings and negotiations and powerful group
politicking, some of the experts have 'considered the steering committee approach as the most
suitable approach to get the best results in the MIS function. The user involvement can be
ensured by having their representatives on the steering committee. A steering committee formed
under the chairman ship of the chief executive with 5-10 members has been found to be an
effective experience.

3.13 LOCATION OF MIS FUNCTION IN ORGANISATION

One of the issues of crucial organizational importance is that of the positioning of the MIS
function in an organization. Some researchers prefer a direct reporting of the chief of MIS
function to the Chief Executive, whereas others have favored a decentralized user group
reporting.

3.14 THE FUTURE

Indeed, even the newly-emerging computer systems concept of information resource
management (IRM) merely upgrades the computer system and it’s attend and, information to the
position of a resource that is to 00 husbanded and administered; much as are of the
organizational resources, such as raw materials and about.
Even Nolan's (1979) notion of evolutionary stages in the life cycle of integrating data processing
into an organization does not deal with the realization of the real potential of computers. In his
Upstaged (VI) - Maturity - he speaks of data resources management in terms of 'the applications
portfolio being complete with its structure 'mirroring' the organization and the information lows
in the company. Thus even in the most advanced stage of development of Nolan’s model, the
computer resource is still treated as a service function other than a strategic resource.

Such notions as IRM all a maturity state at which the Computer system is operating
synchronously with the organization have clear merit. During the era when the computer was
relegated to the back-room, it was not subjected to the same levels of hard nosed management as
was virtually every other element of the-business firm. A basic management technique such as

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performance quotas which are common in areas as diverse as production and sales, have been
only recently instituted in the computer area. Thus, better management of the computer system
and its development is a clear need that has begun to be understood and implemented. However,
the potential for information management is much greater than that which is the province of
IRM. There is a stage of development, only beginning to be perceived Cubs' realized that goes
beyond Nolan's notion of 'maturity'. The role of computer systems in organizations is beginning
to challenge dramatically. With this changing role will come the potential for vast' change in the
impact of computers and for the realization of a knowledge society.

This emerging role of computer technology in business is easy to envision. One need only view a
major business firm to see that new computer-based technology is being introduced in quantity at
many locations- word processing systems electronic mail and filing, electronic communications
networks, desk top computers, etc.-Moreover; these technologies are rapidly being linked
together into more comprehensive, systems. For instance, the concept of a decision Support
system (DSS) reflects the integration of a number of technologies that have existed for some
time.
A major implication of this explosion of technology is that Jar more people - from clerks to
executive -will be directly involved with the computer system than ever were before. Computers
and appurtenant technology win no longer created to the basic room as a specialized service
function that has little to do with the day-to-day activities of most people in the firm. They will
be 'out in front in virtually every office, workstation and production line. In the past only a small
number of computer specialists were in direct contact with and were direct 'users' of the
computer system. In many organizations one member of each department or unit has been
specifically identified to perform this role. With the technological revolution that is occurring
virtually everyone will be a 'user' of the computer system. This widespread intrusion of
computers into the lives of so many, which have a profound impact, and while it, will not be
without problem. It will tend to increase understanding, reduce apprehensions and enable many
more people to better envision .the widespread potential for computer applications, Heretofore,
many such applications have been envisioned only or computer specialists who often, had
difficulty selling their ideas to management or have gone unseen because computer specialists
lacked the requisite business knowledge and experience to relate computer capabilities to

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business needs.
This pervasiveness of computers and the increasing familiarity of people at all levels of the
organization with them will inevitably lead to a wide variety of new computer applications. More
importantly however it will lead to the amplification and acceleration of a phenomenon that is
already beginning to be experienced tile creation oh comparative business advantage through
information.

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UNIT FOUR
OVERVIEW OF SYSTEMS
ANALYSIS AND DESIGNS

Objectives
After going through this unit, you should be able to:
 Understand the concepts of system
 Understand what and why of Systems Analysis
 Develop it broad appreciation of Systems Design.

Structure

4.1 Introduction
4.2 Systems Concept
4.3 Systems Analysis – What and Why
4.4 Overview of Systems Deign.
4.4.1 Overview of Systems Design vs Objectives of the organization
4.4.2 Study of the existing system
4.4.3 Conceptual design/Feasibility Study
4.4.4 Detailed design and implementation- Brief Description
4.5 Summary
4.6 Self-assessment Exercises

4.1 INTRODUCTION
You have already received a fairly good idea of System in. This unit apart from briefly -
repeating some of the ideas further builds upon them.
Some definitions:
- Webster unabridged dictionary describes system as set or arrangement of things so related or
connected to form a unity or organization.
- A system is an organized, interacting: interdependent and integrated set of Components
variables/parts. A system has objectives or Coals (Lucas, 1985, p.5)

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-A system is a set of elements forming an activity or a processing procedure/or a scheme seeking
a common goal or goals by operating op data/and/or energy and/or matter,(inputs) in a time
referees to yield information and/or energy and/or matter,(output) (Murdic Ross and cIaggett,
1990, p.1S). .

4.2. SYSTEMS CONCEPT

There are several ways of classifying systems. Three such classifications are:
(1) Natural or man-made; (2) closed or open; and (3) conceptual or physical.

Naturally systems occur in nature e.g., solar system. On the other hand man made system are
deliberately created for specific objectives for example. Defense System disposal system
organizations etc.
Closed systems theoretically, are self-sufficient and have no interactions with their environment
in practice; those which are relatively cut off from the environment are termed as closed. For
example, dry Battery Cell. Whereas open systems exchange Information and or energy and or
material with their environments. As members (part) of a system they receive from the
environment as inputs and give to the environment as outputs. For example, Man , Living
Beings, Business Organizations.

These classifications are not exclusive: For example, there can' be a system which is man made,
open and physical.
Characteristics of a System as outlined by Schroderbek are:
1) System is a whole.
2) Components of a system interact.
3) Systems are goal seeking.
4). Systems have input/output.
5) Systems transform inputs to yield output.
6) Systems exhibit entropy.
7) Systems must be controlled.
8) Systems form a hierarchy.
9) Systems exhibit differentiation.

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10) Systems exhibit equifinality.
In subsequent sections, we will be particularly interested in open, physical man made systems
such as Organizations and Management Information Systems.

4.3 SYSTEMS ANALYSIS - WHAT AND WHY

What is Systems Analysis?
HarryY Goode and Robert Machol's view of Systems analysis is quoted below:
For more than a decade, engineers and administrators have witnessed the emergence of a
broadening approach to the problem of designing equipment. This phenomenon has been poorly
understood and loosely described. It has been called Systems 4esign, Systems analysis and often
the Systems approach. Rarely does the speaker using these terms intend to convey those concepts
which are brought to the minds neither of his hierarchy, nor for that matter are any two' hearers
likely to be in agreement.
Analysis of the system means identification, understanding and critically examining the system,
and its parts (sub-systems) for the purpose of achieving the goals (objectives) set for the system
as a whole, through modifications, changed' interrelationship so(components. deleting or
merging .or separating, or break up of components. It may also involve upgrading the system as
a whole.
The methodology of systems analysis involves (1) identification of the system (setting system
boundary), the system objectives, the system elements (components); and (2) understanding the
role and interrelationship of elements with other elements of the same system.
Through this identification and understanding process; (1) the capability (or background) to
analyze and compare various alternatives regarding components and (2) system functioning vis-
à-vis the system objectives, is generated. Outcome of the systems analysis job is a set of
recommendations towards creating a system which best, meets its objectives giving due regard to
cost-effectiveness and the risks.

Systems analysis, thus, emerges as a means through which the total system is conceived
designed. Implemented and made operational to achieve the desired objectives. The basic
objective of systems analysis is to understand and modify the system in some way to improve its
functioning. The modification may, require one or more of the following: change the outputs,

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change the goals of the system, make it more efficient, have different set of inputs or improve in
some other way or even create a new system.

Why Systems Analysis?

The understanding of what -systems analysis is in itself provides an insight into its importance
and why it is needed. Systems analysis basically is an approach towards viewing the processes,
activities and complex problems their totality. Thus specifically:
- It offers a means to greater understanding of the complex structures
- It is a means to trade off between functional requirements of a subsystem (component and its
immediately related subsystems.
- It helps in understanding and comparing functional impacts of subsystems to the total system
- It helps in achieving inter-compatibility and unity of purpose of subsystems - It helps in
discovering means to design systems where subsystems may have apparently conflicting
objectives,
Finally, it helps in placing each subsystem in its proper perspective and context, so that the
system as a whole may best achieve its objectives with minimum available resources. It thus
creates synchronization between systems 'and objectives.
Thus, systems analysis is one of the important techniques that provide a systematic and broader
outlook to understanding, examining and creating or modifying systems to meet specific
objectives. Systems analysis and design is an interactive and creative process.

4.4 OVERVIEW OF SYSTEMS DESIGN

Having seen what is systems analysis and why it is done, let us examine how the objectives of
the organization in place the objectives of Systems Design and then examine in stepwise manner
how it is done in this section.

4.4.1 Objectives of Systems Design vs Objectives of the Organization

Many authors have discussed the term' and the process of system design from/the viewpoint of
developing specific computer applications or programs through the broad steps are basically the
same" the magnitude of the task is much larger when viewed' from the point of developing MIS
for the organization as a whole. Usually the steps follow what is termed as 'life cycle stages'.

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Since basically a Management Information System is expected to help the organization and the
management in the discharge of their functions it is imperative that the MIS system development
effort begins by understanding the organization's objectives. For these are required to be
translated to constitute objectives of the MIS.
The following schematic diagram (Figure 4.1) gives an overview of the broad steps involved in
MI~ design/development process. For better understanding of the design process, it has been
divided into these broad categories. Essentially a designer will have to think Pi all stages
simultaneously irrespective of the fact at which state he is. He doesn't proceed by completing one
stage and moving on to the next stage and pot considering previous or such client stages.

Overview or MIS development

Organization Systems Conceptual Implementation

management objectives and Design
objectives and Requirements
needs

Operation and
. Evaluation

The broad stages involved in MIS development as depicted in Figure 4.1 are:
Organization, Management objectives and needs which are converted, to systems objectives and
corresponding broad requirements to meet these objectives are estimated) followed by a
conceptual design: feasibility oblivious alterative ideas for each of the system elements in the
tight of the systems objectives and the resources available are tried out at this level. This
conceptual design is converted' into detailed design specifying each action in precise and
physical context for each clement of the system. Finally system implementation and evaluation
takes place which continues over a period of time. If need be the whole process from stage 2 is
recreated. In exceptional circumstances generally when major changes at organizational level or

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technological level or in the environment take place the connection to stage I is shown through
dotted lines. This would mean that a new system is to be designed and the whole process of
repeated.
In the first stage, the understanding of the organization's and management's objectives leads to
appreciation of key areas or the thrust areas of the organization and is helpful, in setting broad
objectives for the, MIS such as major reliance on models, development l)f forecasting
techniques, or large storage and retrieval capability, or -requirements, or may be in some cases
,the major activity would be routine reporting and storage. Anyone or combination of these broad
objectives Of MIS would be possible only through management and organization
objectives.11iese broad objectives would be further refined and Specified in detail relining
through various levels of management and various functions of the organization.

4.4.2 Study of the Existing System

Unless it IS entirely a new activity or new organization for which MIS is to be developed, there
'is always some existing system, formal or informal or even trivial as such there is need for
interns jested and, critical examination of the existing system.
Since the need, for a new system has arisen either because of some type of dissatisfaction with
the existing system, or the objectives and need of organization as well as MIS have been
drastically changed, change in the existing system or a new system is required.

There are two schools of thought regarding whether for development of a system the old system
should based or not? One school of thought is for and tiles other against. The argument against is
that it inhibits the generation of new ideas and may bias the designer towards the same logic
which is contained in the old system. Whereas the other school argues that through study of
existing System one leaks about its shortcoming and may use this knowledge to avoid
committing the sate institutions other arguments are valid. We suggest the study of the existing
system if any; to learn more about the total system.

4.4.3 Conceptual Design/Feasibility Study

The term conceptual design has been interchangeably used with gross design feasibility study,

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high level design and in some cases, even with preliminary design by various authors; the use of
these different terms gives a broad idea, of the functions performed in this phase of conceptual
design.
These functions, at this, stage are at a very general level. Finer and finer details are taken up as
we progress through detailed design/physical design, implementation, evaluation etc. Here we
consider various broad alternatives to match the system objectives, user’s requirements with due
regard to cost ad saving factor. The outcome of this stage is in the form of broad suggestions e.g.
central data base/distributed data base; batch processing/on-line processing; etc. It could also
specify upper and/or lower 'limits of peak and arrange processing loads. Thus the accent is on
comparing, analyzing, and matching various alterative and combinations. Even though system
objectives in relation' to management/organization objectives have already been discussed, they
are again reviewed and made more specific with respect to peak level process loads, complexity
of processing, time frame for various types and categories of output, frequencies of occurrences,
communication needs etc,

On the other side, assessment is also made of the restrictions or constraints on the freedom to
develop MIS. These restrictions may be external or internal and may be with respect to content,
processing requirements, procedures, input/output formats, data frequency data accuracy, units of
measurement etc.
External constraints may be due to government, customers, suppliers, unions, social groups etc.
Internal constraints, can be due to the are of operations of the organization, its policies, attitude
and support of top-management, the prevalent .work culture within the organization, cost and
resources for the proposed system, willingness of the user employees, availability of required
skilled manpower, internally and externally, etc.

Preparations and use of input70utput charts information flow charts, activity flow charts,
operati6n flow charts; multi-intentional flow charts are helpful and add to the understanding of
sources flow-and information processing requirements. External sources vis-à-vis management
requirements are also a critical avenue for investigation. These are vital at the highest level of
management for policy planning and strategic functions. The repeated identification and analysis
of sources and processes requirements iteratively leads to a match against previously determined

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information needs. All these steps and the use of various techniques discussed so far, also help in
identifying origins and restoration of information and help in establishing progression of
information through the organization. They also help in arriving at better' understanding and
estimates of frequency volume, time processing, storage cost and communication requirements.

In the Context of understanding generated with respect to MIS objectives, information needs
sources and processing’s; the conceptual design development activity is taken up. Conceptual
design is a sketch of the structure or MIS listing broad guiding policies as well as restrictions
within which the detailed design development can be undertaken.
The conceptual design, or for that matter any design, is a creative activity. It should come out
with broad viable alternative combinations of input, storage, processing, communication and
output to be able to generate various conceptual designs of MIS viz.

Inputs
- Largely internal/external or both specifying whether emphasis is on internal or external sources.
- Specific, routine or presently not known
- Accuracy levels - high/medium/approximations or combinations
- Time lag of capture - instant, immediate or delayed (say, per shift, hourly, daily, weekly).

Data Base
- Centralized/distributed
- Large capacity/medium capacity now capacity
- Retrieval- Random access storage/sequential access storage
- Is it largely sequential/relational/etc.
Processing
Largely batch/on-line/or a combination
- Complex, e.g. -use of sophisticated models/scientific requirements/graphics/CAD/CAM etc;
Not complex e.g. word processing.

Communication and Output

- Instant/time tag/specified intervals

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- Written/verbal/visual (VDU)/Graphic etc
- Direct/routed through.
- Frequency - instant/daily/weekly etc.
- Routine ad hoc/on demand
- Reports/query/dialogue, etc.

For example, one of the outcomes could suggest:

Input - Internal highly accurate instant
Data base- Distributed random & sequential access medium capacity at each location
Processing - Complex: scientific application on-line printing as well as graphic requirements
Communication and output- On-line between various departments: text and VDU both direct
routine and ad hoc both: reports, query and dialogue but more emphasis on query and dialogue
between departments as well as man machine

Thus, for the same match of information needs processing-and source (input) requirements there
could be several, such alternative combinations each alternative being viable. These alternatives
need to be compared to choose one so that dallied design and later on implementation could be
started. The basis of comparison could be:
I) Anticipated performance: Each alternative should be objectively assessed at conceptual level
as to what extent it meets the MIS objectives stated earlier and to what extent it meets the
company requirements.
2) Cost-effectiveness: Some type of cost-benefit analysis is performed for each alternative.
Rough projections of equipment requirements and costs operational costs manpower costs
maintenance costs etc need to be made Projections of potential tangible as well intangible
benefits are also needed to be made. For example, tangible benefits can result from such modes
as reduction in present or future manpower requirements savings result to a particular alternative
such as reduced inventory, educed scrap, faster receipts faster reconciliation reduction in loss due
to frauds e.g. in banking etc.

3) Operational Basis: For each alternative, analysis is required to assess the strong and weak
points in respect to quality of data base, quality of information ability to withstand peak loads of

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storage as well as processing ability to anticipate preparedness to take up ad hoc demands
avoidance of duplication etc. Broadly what needs to be assessed is will it work when
implemented and to what extent?

4) Technical basis: It is also important to project each alternative with respect to technological
requirements in storage, processing, communication, output etc. and assess Are they easily
available? Will they be within the budget? Does it match the present at all future needs? Is it too
sophisticated for the staff of MIS to handle and accept?

4.4.4 Detailed Design and Implementation - Brief Description These two phases of the total
system design activity will be discussed at length in later units, specially implementation phase.
A brief description is felt necessary at this point so that you appreciate that the conceptual design
in itself is not the end of the design activity.'
The basic task of a detailed design task is to convert the broad concepts of the earlier phase into
very specific and detailed description of all the activities needed to' produce a physical system
that actually operates. Thus the outcome of this activity is specific unlike earlier phase i.e.,
conceptual design/feasibility study which gave vague broad guidelines.
..
Thus, detailed design phase will provide -detail specifics with respect to:
Input/output forms: What information, from where, when, in what format would be entered;
similarly for outputs.
Data Bank: It includes the exact description of storage of input information including the
equipments, the input devices and procedures and output devices and procedures. On the whole,
the Data Bank Management in its totality would also include detailed file discretions and design.
Processing: is a description of models procedures and handling/manipulation of information to
come out with adequate outputs.
The final outcome is in the form of a completely documented report which on implementation
results in a real physical operating system. It is like an engineering specification or blueprint of
products made available to production shops for manufacturing.
When detailed design specifications are available the implementation activity phase starts. The
basic function of this phase is to transform the specifications into physical realities - to come up

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with a physically operating system, as per specification, on schedule, within stipulated costs, to
match the system and company- requirements: Briefly, the activities performed in
implementation phase are: prepare the implementation plan - use of Gant Charts or CPM/PERT
networks advisable.
- acquire and layout floor space
- recruit personnel
- train the operating and user people,
-obtain and install hardware equipment,
- develop and test software including programs, design of forms (input as well as
- output), files data base etc., and
- finally, testing and retesting various components of the system before the, operation and
maintenance phase.
4.5 SUMMARY
There are three types of systems: (1) natural or man-made; (2) closed or open; and (3) conceptual
or physical. In this unit we referred to open; physical man-made systems such as Organizations
and Management Information systems. After examining the 'what' and 'why' of systems analysis,
it was seen that analysis of the system involves identification, understanding and critically
examining the system, and its parts (subsystems) for the purpose, of achieving the objectives set
for the system, as a whole, through suitable modification of its components. Finally, actual
system design is done by identifying system objectives and boundaries conducting feasibility
study developing the system design in detail and the implementing it at the user site.
4.6 SELF-ASSESSMENT EXERCISES
l) Explain a system. Why systems view is justified towards organizational information needs?
2) Why analyze a system?
3) Describe the major phases in MIS design. Can you compare these phases with Research and
development projects?
4) Why does conceptual design also sometimes called feasibility study?
5) Prepare an information flow chart for a major/minor activity that you are performing in your
job or you are familiar with.
6) Prepare a complete list of information requirements related to your job - also specify timings,
that is, when do you need them?

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7) Is it possible to design and implement a mini MIS related to your job activities? Try to design
one.

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UNIT FIVE
SYSTEM DEVELOPMENT
LIFE CYCLE

Objectives
After going through this unit, you should be able to:
. identify the mechanism involved in the system development life cycle;
. differentiate between various stages of system analysis and design,
. appreciate the efforts involved in and criticality of each stage.

Structure

5.1 Introduction
5.2 Models of Information Systems
5.3 System Development Life Cycle
5.4 Problem Definition
. 5.5 Feasibility Study
5.6 System Analysis
5.7 System Design
5.8 System Development
5.9 System Implementation
5.10 Post-Implementation Maintenance & Review
5.11 Project Team Constitution
5.12 Effort Distribution in System Development Life Cycle
5.13 Summary
5.14 Self -assessment Exercises

5.1 INTRODUCTION
Regardless of where the data or information processing system has been implemented, what
functional area it addresses, what level of management it caters to and who has designed,
developed and implemented it, the growth of an information system passes through various
identifiable stages and all these stages put together are referred to as the System Development

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life Cycle.
The system size, complexity and coverage do not affect these stages. Any system designed for
processing of information revolves around a life cycle that begins with the recognition of the
problem and ends up with development and implementation of the system.
To appreciate the stages involved in design and development of an information system and the
efforts required to build up these systems, it is a must that managers should be familiar with the
distinct stages of this cycle. The present study unit discusses these steps and related issues.

5.2 MODELS OF INFORMATION SYSTEMS

The information systems are considered to be evolved through three different levels of systems.
These are:
a) Conceptual System: Every information processing system is evolved by way of a concept
when somebody imagines that the organization should have such and such a system to
accomplish such and such an objective. A system so conceived mayor may not be attained in
reality. A conceptual model is no more than an idea.
b) Logical System: When the conceived system model is further worked out to design new ways
to accomplish the objective set out in the conceptual system, it becomes the logical system
design. A logical system design necessarily includes understanding of the flow of information,
logic of processing and input-output relationships. The Data Flow Diagrams, Flow Charts etc.
are the basic components of the logical models.
c) Physical Systems: When the logical models are developed to actually deliver the desired
results, it is referred to as a physical system model. The physical system model can be tested and
implemented. It consists of the programs, data files and documentation.

5.3 SYSTEM.DEVELOPMENT LIFE CYCLE

System development is an iterative process and it consists of the following identifiable
a) Problem Definition
b) Feasibility Study
c) System Analysis
d} System Design
e) System Development

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f) Implementation..
g) Post-implementation Maintenance & Review
In practice, these steps mayor may not be clearly: defined in a given system, and there is a
probability of an overlap of these stages. It is quite likely that while the system analyst is
working on a particular stage, he is also considering possible. Solutions related to the next phase.
There is always a possibility of coming back from an advanced stage to revise or review the
decisions taken in the earlier phases.
Errors are costly in system analysis and design. But these become more and more costly as you
keep going from an earlier stage .to an advanced stage. The cost of fixing an error detected in the
earlier stages is lesser as compared to the same detected at a later date. The simple reason for this
is that an early\detection of error will necessitate revision of fewer decisions whereas a late
detection of an error will require revision of all the steps taken so far, so utmost care is necessary
on part of the system designers, while going through various stages.

100.0

50.0

20.0

10.0

5.0

2.0

1.0

0.5

0.2

0.1
Problem Feasibility System System System System
definition analysis design Development Information

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5.4 PROBLEM DEFINITION
Organizations face problems during their operations and come across opportunities which could
be converted into profitable solutions. Whenever there is an opportunity and/or problem in the
existing system or when a system is being developed for the first time, the organization considers
designing a new system for information processing.
The organization may face a problem or get an opportunity due to:
- a new product/plant/branch/market/process
- a failure of an existing system
- inefficiency of an existing system
- programming errors in the existing system
and therefore, a thorough analysis of the situation is required. For identifying problems and/or
opportunities, we scan:
- the performance of the system
- the information being supplied and its form
- the economy of processing.
- the control on the information processing
- the efficiency of the existing system.
- the security of the data, software, equipment, personnel etc. After identifying the problem, it is
defined and a general direction for solving this problem is also determined. The project
boundaries are defined. The management also establishes the terms of reference as well as the
resources to be provided for the project. Final output of this stage is Terms of Reference.

5.5 FEASIBILITY - STUDY

After the user has identified the need for a new system, his requirements are determined and the
terms of reference are established. The proposed system has to be viewed from the practical
utility and acceptability dimension. A few questions which are usually asked during this stage
are:
a) Is the proposed system worth developing?
b) Will the proposed system contribute by way of improved efficiency productivity
organizational effectiveness?
c) Will the system improve information availability and be cost-effective?

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d) What will be the system development costs and will these be justifiable?
e) How will the user departments take this system and what will be the overall impact of this
system on the organization?
The key considerations involved in the feasibility analysis are:
- Economic.
- Technical
- Behavioral
The economic feasibility will only consider the cost/benefit analysis of the proposed project. The
benefits are always expected to be overweighing the costs.
The technical feasibility always focuses on the existing computer hardware and software. This
also includes the need for more hardware or software and the possibility of procuring/installing
such facility.
The behavioral feasibility includes a study of the organizational behavior. An estimate of how
strong the user reaction will be to the new system will have to be made at this stage.
The final output of this step is a Feasibility Report having discussions on Financial Feasibility,
Economic Viability, Technical Feasibility and Social Acceptability of the proposed system.

5.6 SYSTEM ANALYSIS

The system analysis includes review of the existing procedures and information flow. Decision
making and individual information needs at various levels in different functional areas are also
reviewed. The system analysis phase primarily focuses on isolation of deficiencies from the
existing system. The fundamental activities involved in the system analysis are:
- Definition of the overall system
- Separation of the system into smaller and manageable parts
- understanding the nature, attention and interrelationships of various subsystems. The analysis
of the information systems could be done with the help of various tools of system analysis. Some
of the tools which are available with the system analysts are: Review of documentation:
documentation on the existing system could be reviewed and analyzed to study the objectives,
reports, procedures being followed and equipment being used. The only limitation with this
technique is that the documentation of any existing system is never complete and up-to-date.
Observation of the Situation: The system under study can always be observed by getting

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involved in the system. The system analyst can work in the system or can be a mere observer.
The exercise is time consuming and costly. Also it has an inherent limitation of the fact that the
analyst may never be able to observe the intricacies of the system.

Conducting Interviews: is the system analyst that can help us conduct interviews with the user
managers and ask questions related to their job responsibilities. The interviews could be formal
or informal ones and may span over a period of time. The initiation of this tool is that the user
manager may not be able to explain the problem in detail. Questionnaire Administration: A
printed structured or unstructured questionnaire may be administered to find out the information
needs of individual managers. The questionnaire survey does help in saving time as compared to
interviews as well as gets more committed data not it is impossible to design an exhaustive
questionnaire to cover various aspects of the system under study..
The analysts use a combination of all these tools to analyze an existing system. The analysis
phase is a time consuming phase and yet a very crucial phase. The final output of this phase is a
functional specification report of the existing system.

5.7 SYSTEM DESIGN

If the system analysts’ phase defines the way things are, the system development phase defines
the way things should be for the same problem.
The system development phase includes mapping of the business requirements of the managers
on to the proposed system. The conceptual design of the model which has been developed in the
problem definition stage is enlarged to understand the actual flow of data and the logical model
is developed. The logical model is worked out to finally develop and test the physical system in
the system development phase.

The system design should be as hardware and software environment independent as possible.
The system development team should always keep in mind the cost-effectiveness. This phase
includes development of the following:
. Output definitions
. Input Definitions
. Data Element Dictionary

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. Program Specifications
. System Specifications
During the system development the analysts also undertake the) codification and compression of
the data to:
- use lesser magnetic storage space
- commit lesser mistakes while entering data
- maintain uniformity of data
- incur lesser cost in entering updating, processing and storage of data. Output Definitions: Are
there detailed reports screen and file layouts which will be outputted by the programs throughout
the system? The system analyst is required to consult the user in finalizing the system outputs.

Input Definitions: The data coming into the system has to come though some input formats and
these formats are defined by the design of input documents.
Data Element Dictionary: A document which contains confide details of each and every data
item used in the system is called a data dictionary. The data dictionary contains the following
details regarding the data items:
Name
Description
Source
Usage
Maintenance
Storage
Organization
Program specifications: The actual logic built up for individual program is defined in the
Program specifications by way of decision tables’ decision trees and program flow charts. The
program flow charts could be drawn for individual programs or parts of the program. These tools
are necessarily used for storing the logic of processing in individual program for future
reference. The logic could also be stored by using English language which is also referred to us
pseudo code.
System Specifications: The system specifications include description of the relationships of
various modules of the system among each other and relationships between different programs

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within a subsystem. Though the system specifications do not give the details of logic being
followed it gives the flow of processing among the programs files and reports. Apart from using
descriptive English the system developers also use System Flow Charts for depicting system
specifications. The end result of this phase is a design specification report which includes the
existing system the proposed system, system flowcharts. Modular design of the system print
layout charts data file designs etc.

15.8 SYSTEM DEVELOPMENT

Following the modular design of the proposed system; the system analysts assign specific
responsibilities to the programmers who develop and test the programs. The development and
testing of the systems take place in a phased manner: Development and testing of the individual
programs.
. Development and testing of the individual programs as a part of the system modules.
. Development and testing of the system modules as a part of the major subsystems
. Development and testing of the major subsystems as apart of the proposed system
The development of the system includes writers of the actual programs to handle data excellent
programming skills and experience is required for this phase of the system development life
cycle. The basic activities involved in this phase are:
- Checking of the program specifications received from the system development stage and,
expanding these specifications
- Breaking the system modules into smaller programs and allocations these programs to the
members of the system development team
- Producing the program code in the chosen computer programming language
- Defining the interfaces between various program and designing tests for checking their
interfaces
- Ensuring the data availability for individual and integrated testing
- Checking the quality of the code and its adherence to the established standards
- Prepare the documentation for each one of the programs
- Receiving the user data for acceptance testing
- Getting the user sign-off after the acceptance testing
For development of the proposed system, it is important that all possible support should be

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provided to the development team. This support Includes availability of:
. Office Spate
. Relevant Data
. Secretarial Assistance
. Access to key functionaries throughout the system development effort. The final output of this
phase is a fully developed and tested software system along witI1comptete documentation and
testing results.

5.9 SYSTEM IMPLEMENTATION

Once the system has been declared fully developed and tested by the development team, It is
ready for Implementations with the user department. The involvement of the user IS necessary
throughout the project duration, but the user involvement is critical during this phase.
The implementation includes the following activities:
. Planning for implementation
. Preparing .the schedule for implementation
. Procurement of hardware
. Installation of software
. Operation and testing of software on hardware
. Recruitment of operating personnel
. Motivation and training of the selected personnel and Users
. Conversion of data files from old system
. Final changeover
. Operation and production
Once the system has been implemented; the systems group provides outside support to the user
group and trains the user group to handle production and operations of the system.

5.10 POST-IMPLEMENTATION MAINTENANCE & REVIEW

Though the system is thoroughly tested before the implementation, yet the system is never
foolproof and errors always continue to exist. Therefore, there is a need to 'have a systems
person to look after the system and maintain it even during the operation and production. The
system maintenance could be because of any of the following reasons:

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- Minor changes in the processing logic - Errors detected during the processing - Revision of the
formats of the reports - Revision of the form as for data inputs,
Also the management is keen to/knows the quality of the system developed and the standards
which have been followed. There is usually a review team which evaluates the implemented
systems and suggests changes, if required. It also leads to integrated and standardized syst6m
development.

5.11 PROJECT TEAM CONSTITUTION

For undertaking a study and design of a commercial information processing system, a. project
team is constituted. The members of this team are drawn from various functional, areas and
professional backgrounds. This team is usually of 7-11 member size. Each member is assigned
specific responsibilities with scheduled deadlines for each-job. The involvement and
representation of the user departments and affected parties is ensuring while constituting such
project teams. Normally organizations face a dilemma about choosing a project leader. The
choice is between the user group or the systems group. Depending upon the availability,
experience and type of project, the leader is chosen. It is in the interest of the proposed system
that all the members of the project team should have sufficient time at their disposal and take
keen interest in the p-progress of the project.

5.12 EFFORT DISTRIBUTION IN SYSTEM .PEVELOPMENT LIFE CYCLE

The distribution of the organizational efforts over various phases of the system development life
cycle can be seen from Figure 5.2. It can be seen that over the life cycle, almost half the efforts
are devoted to maintenance lifter implementation and half the efforts in the system development
itself are devoted to the testing' and debugging activities. This once again underlines the need for
a thorough testing and debugging of the information system before it is implemented.

Analysis System life-time

Design
Coding
Maintenance
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 Testing and
debugging

Figure Distribution of effort

5.13 SUMMARY
Every system either developed as an improvement over the existing system or developed for the
first time has to undergo various indefinitely stages. The unit has discussed these stages as
problem definition, feasibility study, system analysis system design, system development,
implementation mc maintenance. The birth of a system takes place when the conceptual model is
developed by way of expressing a need.
This need is converted into logic for fulfilling of this need. It ultimately gets converted into data
files program and documentation at the stage of physical model. The total development cycle
needs more than one full-time individual. Generally a project team consists of members from
user group as well as systems group.

5.14 SELF-ASSESSMENT EXERCISES

1) What are the various outputs of each stage of the system development life cycle?
2) Analysis is the system whereas design is the how of the system, Comment.
3) What arc the various stages of a system development life cycle and how are the efforts
distributed over these phases?
4) What are the various system analysis tools and why do we need more than one tool at a time?
5) What do you understand by concept logical and physical models of a system?
6) Discuss the various steps involved in programming.

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UNIT SIX
DESIGNING ON LINE AND DISTRIBUTED
ENVIRONMENTS DESIGN CONSIDERATION

Objectives

After going through this unit you should be able to:

. Understand system design features related to on-line systems
. Know about the various computer system concepts related to on-line design.

Structure
6.1 Introduction to on-line or Real-time Environment
6.2 On-line System Analysis and Design Considerations
6.3 Selecting a Language
6.4 Application and System Software Required for On-line Systems,
6.5 Multitasking or Multiprogramming
6.6 Multiprocessing
6.7 Real-time Systems
6.8 Problems of Real-time Scheduling
6.9 Summary
6.10 Self-assessment Exercises

6.1 INTRODUCTION TO ON-LINE OR REAL-TIME ENVIRONMENT

Data processing on computers in its conventional form consisted mainly of batch-processing -
sequential or indexes sequential, much after the event for which the processing was taking place.
However with sophisticated need for computers the need for on-line or real-time processing
came up. On-line or real-time processing is the processing of data on computers to, produce the
requisite results in very short time to enable an event to take place: Some of the activities which
take place in real-time processing with computers are:
i) Computer aided Manufacturing: Where processes like thermal power generation are controlled
by computers,
ii) Computers and Space: Where the launching and journey of rockets/satellites, in space is

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controlled by computers
iii) Computers Medicine: Where vital activities of the body like electro cardiogram are
controlled by computers.
Acclivity A
From your experience give five more examples of real time system other than those mentioned
above.

6.2 ON-LINE SYSTEM ANALYSIS AND DESIGN CONSIDERATIONS

In an earlier Unit you have been introduced to system analysis and design. Let us see here what
are the factors that influence online system analysis and design? Before we take up the
abovementioned task let us define the term system. A system is a group of interrelated
subsystems interacting with each other and the environment achieve a desired objective.

Making even minor changes without considering what has been done previously can cause errors
or have unanticipated effects elsewhere.
While designing a system it should also be remembered that the final decision making, regarding
the end output of the system is the user's prerogative. The impetus or need for system
development should come from the user community. Treating a computer, as a solution-in-
search-of-a-problem, instead of a tool to solve an already-identified problem can only lead to
mistakes.
-Even on-line system design consists of preliminary investigation and feasibility study. Detailed
investigation consisting of:
- fact-finding
- data analysis and evaluation
- estimating costs and benefits, and
- preparation of a system proposal follows

By maintaining objectivity in fact-finding, the analyst can separate habitual or traditional acts
from acts resulting from actual requirements and thus ultimately evolve a suitable system design
in the data analysis and evaluation phase.
Data analysis and evaluation consists of recording; organizing and evaluating collected facts.

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Information, system personnel begin to extract significant factors that help them identify the
user's system requirements from this wealth of data. Increasingly, analysts are using computer-
assisted software engineering (CASE) tools to organize and analyze data. The term CASE has
been coined to refer to the automation of tools, methods and procedures used in system
development. The products that accomplish the automation are computer programs, referred to
collectively as CASE tools. They are grouped within two broad categories:
- Front-end CASE tools assist in the analysis of user requirements, description of data elements,
description of operations (e.g. page sizes and numbers of copies for report printing), a high-level
system design (output, input and file formats, high-level internal program structures and so on).
-Back-end CASE tools used to convert specifications into machine - executable codes, assist in
debugging and testing, and/or restructuring exiting database’s and programs
Some analysts organize their findings on data flow diagrams (DFDs),
Once a system proposal has been approved by the user, the team of analysts and programmers set
about coding and developing programs for the system. Designers can use any of the several
CASE tools or create mock ups, called prototypes for user review as early as possible.

Various methods used to design the system can be summarized as:

i) Top-down design: When doing top-down design we look first .at the' major function to be
accomplished by the system and then fill in the details. .
ii) . Tree-diagrams or structure charts.
iii) Decision tables etc.
Although, the techniques described above are similar to those that might be used for off-line
systems, the major points to be kept in mind while designing on-line or real-time systems are as
follow:
i) Response time of the system should be very efficient to cater to the fast response times
required in real-times systems;
ii) scope of failure of the system due to power failure or bugs in the system should be minimized,
otherwise it may lead to fatal system break-downs;
iii) a certain degree of self-correction and review methods should be inbuilt in the system; and.
iv) Online system design should take into consideration the capabilities of the computer system -
like the number of tasks/programs it can handle at a time, number of terminals which can be,

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attached to it, etc.
After the system analysis and' design phase, we come to the system implementation phase.
However, it must be borne in mind that no amount of good cooling can repair the damage done
by poor design or program coding. While there is no universally accepted definition of what
constitutes the high quality system/program; most users agree that the following characteristics
ate important:
i) Correctness: Extent to which a program/system satisfies its specifications and meets the user's
needs;
ii) Reliability: Extent to which a program/system performs its intended function without error;
iii)Robustness: Extent to which a program/system accommodates and handles unacceptable input
and/or user operational errors. This factor is especially important for on-line systems;
v) Usability: Effort required to operate prepare input for and understand output of a program;
Testability: Effort required testing a program to insure it performs its intended function;
vi) Maintainability: Effort required locating and fixing an error in a program/system.
This is also an important factor in a program/system operating in an on-line environment;
vii) Extensibility: Effort required modifying a program/system to change or enhance its function.
Again, an important factor in on-line systems;
viii) Efficiency: Amount of computing resources required to use a program/system. This is also
an important factor in real-time system design since space required for data and programs should
be large enough to cater to the system requirement;
ix) Portability: Effort required transferring a program from one hardware and/or software
environment to another one;
x) Reusability: Extent to which a program/system cart be used in other related applications; and
xi) Turn-around time: Time required from feeding of input to receiving the output. This is
important in on-line systems.
Activity B
What are the design considerations in on-line systems which ate especially important for It or
different from conventional systems and in what way? Give examples.
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________

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_________

The following methods can be adopted for system implementation:

a) Cut-over to new system and leaving the old system abruptly. This suffers from the drawback
that if the old system is better or the new computerized system has drawbacks, then the new
system implementation becomes very difficult. Bringing back the old manual semi-manual
system is also difficult. Hence this system on implementation is not advised for on-line systems.
b) Phasing out the old system and bringing in the new computerized system in stages. This is
better than the cut-over system, yet in most cases it is difficult to implement in on-line systems.
In some cases, like railway or airline reservations, it may be useful.
c) Parallel run of the old system and the new computerized method till such time as the new
system has established. This is better than the first two methods for on-line systems, as it gives
time to the new on-line system to stabilize.
d) Installation of a new on-line system. This requires repeated and meticulous testing for on-line
systems before it can be adopted. This is true in cases like rockets/satellites launching and
control.

6.3. SELECTING A LANGUAGE

How does one choose from among the myriad of programming languages the language that is
most appropriate for a particular system development effort? Let us back up a bit. The first phase
of the system development cycle is system analysis. The second phase is system design. In most
cases, after the user requirements are understood, alternative solutions can be identified. Today,
most if not all user organizations are confronted by resource constraints. The programming
talent, time and money needed for in-house system development are likely to be in short supply.
Therefore, if application software packages that meet or nearly meet user requirements are
available, they should be considered, perhaps a nearly-meets-requirements package can be
'Customized to do the job. There are no merits in writing a new program if an acceptable one
already exists. However, if detailed program design, coding and checkout are to be done, then
the selection and use of one or more programming languages is required.
Usually, one assembler program, or a system software program written in a language like "C", is
provided for each particular family of computers. Programs can be written for the computers in

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the assembler language that the assembler program is .designed to translate. Theoretically, any
number of high-level-language processors, can be written for any computer. It follows that any
computer can be controlled by programs initially coded in any of several high-level
programming languages, depending on the language processors available.

In deciding which programming language to use, some specific questions should be asked.
Which programming languages are available? What knowledge does the head of the
programming from assigned programmers or user-programmers have of those languages? What
types of problems are throes languages designed for? These and other language selection
considerations are summarized in below:
. Language availability
. Language knowledge of system team,
. Suitability of the language to the, particular problem or application. Ease of learning the
language
.'understandability and documentation ease
. Ease of maintenance
. Language standardization program portability
. Speed of source-program translation by the language processor and language:-processor storage
requirements
. Eminency of resultant object programs in terms of number of Instructions, execution speed and
storage requirements this is especially important for on-line applications

The relative importance of the selection criteria varies depending on the situation.
As we have seen, FORTRAN is well suited for problems that involve mathematical
computations. COBOL was designed with business applications in mind. BASIC was designed
to provide immediate straight forward answers to simple problems. For many end-user real-time
applications, a fourth generation language may be the appropriate choice.
The assembler language of a computer can be used to express all the operations the computer is
capable of performing. If fast execution and/or minimal use of storage by the resultant object
program are of primary importance, use of assembler language may be advisable. Some fourth
generation languages tools allow assembler-language routines to be embedded in fourth

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generation language applications to perform time-critical functions. This is socially important for
on-line systems.

6.4 APPLICATION AND SYSTEM SOFTWARE REQUIRED FOR ON-LINE SYSTEMS

As you may be aware; software is of two types (i) application software and (.ii) system software.
To recall; system software is that part of the software that performs the tasks of controlling the
input, output CPU functions and other instruction-related portions that are performed by the
hardware of the computer system. Application software is the programs written by programmers
to achieve the end-objective of the user community of the computers. System software acts as a
'middleman' between the application software and hardware of .the system.
The conventional batch-processing techniques worked well where large volumes. of input data
were required for processing with significant time interval between one lot of input data and its
required output and the next lot of input data sent for processing, For example the processing of
weekly time cards for employees. They did not work well for small amounts of input generated
randomly or for individual problem solving. Computer manufacturers addressed these needs by
developing on-line direct-access systems.

In an online direct-access application, the computer communicates directly with both the source
and the destination of the data it processes. The data can be sent to and received from local 110
devices, or to and from I/O devices at remote locations by way of communication channels,
transactions can be processed as they are received. Master files can be read to produce up-to-date
output information in the form of status reports, invoices and so on. This approach is called
transaction processing. Because queries about master-file data are received in random order, the
files are generally stored on direct access storage devices.
The first on-line direct-access systems were typified by the early airline reservations system.

These early on-line direct-access systems met many user 'needs, but they were far from perfect.
Because the systems had to respond quickly to many individual transactions, it was neither
possible nor desirable to query or update master files. Instead, the master files had to be updated
continuously. Otherwise, for example, a ticket agent at one location might sell airline space
already sold by an agent at another location.

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Furthermore, different types of transactions, say inquiries, sales and cancellations, required
different programs to process them. These programs had to be kept in secondary storage and
relight into primary storage when needed. Much time was spent in locating and gaining access -
to data and programs, rather than in processing transactions.

To add to the problem, transactions occurred irregularly. During peak periods hundreds of
thousands of transactions bad to be processed within minutes. At other times, the systems were
relatively idle. It become apparent that to use EDP system resources as efficientIY'8nd
effectively as able, new techniques bad to be developed

6.5 MULTITASKING OR MULTIPROGRAMMING

Fortunately, during this same time period, system software and hardware developments were
occurring elsewhere. In 1963, the Burroughs Corporation released its Master Control Program,
or MCP, for use with Burroughs B 5000 computer systems. MCP assumed greater control over
system resources than its predecessors had. Input and output devices were activated by MCP
rather than by application programs. This centralized control was possible because hardware
interrupt conditions signaled to MCP when control of the EDP system should be passed to a
special-purpose routine for lib processing.
MCP could also assign memory areas to programs, determine the optimum sequence and mix of
jobs, determine program priorities and system requirements, and provide for rescheduling if new
jobs were introduced or job priorities changed. More than one user application program could be
resident in primary storage at a time. Since the processor could execute only one instruction at a
time, simultaneous, execution of instructions from different programs was not possible. The
processor could, however, execute instructions from one program, then instructions from another
program, than iJ1Structions from the first program again, and so on. This type of processing is
called concurrent processing. Program logic within MCP determined which system software
routine or application program had control of the B 5000 processor at any given time. Today, a
system that provides these capabilities is said to support multitasking or multiprogramming.

Concurrent execution of programs is desirable because of operations are much slower than

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internal processing operations. Fortunately, the design of modem computer systems permits
overlapping of I/O and processing operations.
Under one approach, the actions of I/O devices are permitted to occur only at fixed points in a
program and only in a sequence established by the program. Such a system is said to support
synchronous operations. As an example, assume a user wants to key in data from a VDU. Let’s
suppose a particular bit in storage is set to 1. The setting of the bit does not cause a read
operation to occur immediately however. At fixed intervals, the processor is directed to test that
bit position. It also tests the bit positions reserved for other I/O devices on the system. This
technique is called polling. When the VDU's turn comes and its bit is found to be set, the input
operation is allowed to occur. Since internal processing operations occur very rapidly, the user
may think the data keyed in is read immediately. That is not the case. All activities within the
system are rigidly controlled by the hardware and/or by stored programs. Other EDP systems
perform asynchronous operations. Such systems are designed to permit the automatic interrupter
of processing whenever the need for I/O activity arises. The input or output device signals the
processor by means of an interrupt when it is ready to read or to write. The interrupt means, in
effect: My particular job is done. As soon as convenient use the data I have given you (if it was
an input' operation) or give me any additional information you have (if it was an output
operation). The signal may be the setting of a bit as above, but in this case, the bit has an
immediate effect. As soon as the processor finishes whatever instruction it is executing it accepts
the data as input or transmits the information as output: Ideally, the configuration and speeds of
the various' 110 devices included in a computer should be such that the processor can work at
full capacity whenever the user workload dictates. Again, because of the slower speeds of I/O
devices, this means that the over-all system efficiency depends heavily on the extent to which
input, internal processing and output operations can be overlapped, or allowed to occur at the
same time.
Even so, if only one program is resident in primary storage and executing, chances are the
processor is idle much of the time.
In 1964, IBM introduced its major third-generation operating system OS/360, for use with IBM
System/360 computers. A System/360 user could select the version of OS/36O that included a
control program called multiprogramming with a fixed number of Tasks (MFI). Each task was
simply an independent unit of work, such as a preemptor subroutine, .that needed system'

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resources. As its name implies, owner could operate on a fixed ~umber of .tasks concurrently.
Actually, it could read jobs from as many as three Job input streams, bundle up to 15 job steps,
and record up to 36 streams of output concurrently.
A system/360 user with extensive data-processing requirements could select another alternative:
a version of OS/360 that included a control program called Multi-programming with it Variable
Number of Tasks (MVT). As its name implies, OS/MVT could control a variable number of
tasks concurrently. It could change the number, size and location of reserved storage areas to
meet the data-processing requirements at any given time. Like OS/MVT, OS/MVT could handle
as many as 15 job steps concurrently. Moreover, once a job step was initiated by OSIMYT, that
job step could, in turn, initiate the processing of other tasks. This was not a 1-to-1 relationship
between job steps and tasks (as existed under OS/MFT). OS/MVT was used on the very largest
mainframes of the late 19605. These big mainframes sometimes had as much as 1 mega-byte of
primary storage. A big application program was one that needed 256 kilo-bytes.
The Burroughs B 1700, announced in 1972, was the first small computer with all operating
system that supported multitasking. Today, there are micro-computer systems with equivalent or
greater capabilities. MS-DOS is a single-user, single-tasking operating system. OS/2 is a stogie-
user, multitasking operating system. It can interact with only one user, but that Use may initiate
the concurrent execution of two or more programs. UNIX is a multi-user, multitasking operating
system, it can, communicate at what .appears to be the same time with two or more interactive
users and can perform concurrent processing.
For real-time systems, multi-user, multitasking operating systems would be ideal.
Virtual storage capabilities allow a system to be used as though more primary storage exists than
is actually present. A greater number of programs can, be running at a time than would be
possible otherwise.

Activity C 'UNIX has been mentioned as one of the multi-user, multitasking operating systems.
Can you name three more multi-user, multitasking operating systems.

6.6 MULTIPROCESSING
Let us pause a moment to clarify some concepts and to related some things we have learned.
Like multi-programming and multitasking, the terms multi-programming and multiprocessing

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are sometimes used interchangeably but they do not mean the same thing. Multitasking involves
concurrent execution of instructions from two or more programs sharing one processor and
controlled by one-major operating-system control program. In multiprocessing, instructions are
executed simultaneously (at the same time, in parallel) on two or more processors; the processors
can execute -different instruction~ from the same program or from different programs at a given
time.
In today's most basic multiprocessing systems, one main processor handles all major processing
functions: Other co-processors handle housekeeping chores such as opening and closing files,
input validation and editing, and file maintenance or perform complex mathematical functions.
The more sophisticated multiprocessing systems involve several main processors. There is no
single computer, .but rather a computer system that consists of several processors linked together
for purposes of communication and co-operation during processing.
Multiprocessing is not limited to mainframe environments for example, the IBM PS/2 Mode! 70
computers introduced in late 1988 have a 32~bit Intel80386 main processor and optionally, an
Intel 80381 math co-processor. Apples Macintosh, SE/30 announced in January 1989, have a 32-
bitMotorola 68030 main processor and a Motorola' 68882 floating-point (math) co-processor.
Many of the problems now being addressed with computer help involve lots of data and lots of
very fast computation and feedback - for example, .monitoring and/or controlling the many
variables' that must be taken into account when journeys into space are initiated. With multiple
processors, parallel work on different problems or on the same problem is possible.

Activity D
Differentiate between multitasking, multiprogramming and multiprocessing and try to give
examples.
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
_________

6.7 REAL- TIME SYSTEMS

A system that can also provide output fast enough to satisfy any user requirement can be further

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classified as a real-time system. Such a system makes output available quickly enough to control
(not simply react to) real-life activity.
The concept of real-time is closely related to immediacy. It is-seen as response time, which we
define somewhat formally to be the interval between completion of input and start of output
from an EDP system.
In actual operation, real-time is a matter of degree, depending upon the application at hand. The
customer service representative of an insurance firm may be willing to wait from 3 to 10 seconds
for details about the coverage of a policyholder. II) a military defense system, responses within
microseconds may be required. Variations in response time are due to differences in the system
workload, internal processing requirements, frequency and type of access to computer files
and/or databases, and so on: Both the hardware and the software must be capable of fast
performance. In addition, the system must be funded by support personnel to fit the requirements
.imposed on it. For example, system characteristics such as the number and size of I/O areas, or
buffers, may be set at system startup time.

Although basic business applications such as order writing, inventory control and payroll can be
implemented as real-time system, they are not likely to be. Increasing the costs of software,
hardware, development and ongoing support is more likely to be justified for specialized
applications in industries such as transportation, manufacturing, banking and distribution.
Computer controlled robotic systems on assembly lines, automated teller machines at ball’s and
points of-sale terminals at retail department stores abroad are components of real-time systems.
In hospitals, patient’s vital signs are monitored at bedside by real-time systems.
Time sharing is a technique that allows several users of an on-line real-time system to use that
system on what appears to be a simultaneous as~. The speed at which the system components -
both hardware and software equate allows the system to switch from one active user to another,
doing nil or part of each job until all work. is completed. The speed may be so great that each
user believes that he or she is the only one using the system. The purpose for which one person
uses the system may be totally unrelated to that of others: The system resources are shared by all.
There are three kinds of time-sharing systems use today:
-General purpose systems, which support several programming languages and allow users to
create and run their own programs;

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- Systems in which wide variety of programs are available for execution but cannot be modified
by users;
Systems in which all programs are related to one major application, and users merely provide
input and request input.
In practice time-sharing system may be a combination of these, with the major application
having first priority. The distinguishing characteristic among the three systems is the degree of
user independence provided.

From the point of view of Databases, Structured Query Language. (SQL), allows real-time
interactive users to access data by entering SQL statements; and programmers include SQL
statements in application programs farther same purpose. In a real-time environment networks
involve a communications or front-end processor which serves as a communication control unit
in a system that must support many users and/or heavy traffic on the data-communication
network.

In a data-communication system, any I/O device at the end of 3' communication channel is called
a terminal. More spccifica1ly, since the device is located at a point other than whether the main
computer, it is called a remote terminal
In real-time systems speed of transmission is important.

6.8 PROBLEMS OF REAL-TIME SCHEDULING

When procedures arc designed for the processing of real-time systems their operations are
usually arranged so that all contingency handling has been preplanned and is therefore built in..
In this way, any requirements for the treatment of exceptional cases or other error handling have
been analyzed in advance and the corrective measures to be taken in the case of their occurrence
have already been planned and constructed. This style of operation may be termed off-line, for
convenience; all at this framework and approach may be considered as a contrast to those which
employ adaptation strategies on the run - such procedures may similarly be styled as 'on-line'.
The latter is self-evident in 'expert systems' and systems possessing artificial intelligence.
'Off-line' maintenance of real-time systems is evident, for instance like in a local reservation
system for railways where the system can be interrupted for some time' and maintenance carried

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out. On the other hand, an expert system following a satellites journey in space may need 'on-
line' maintenance.
Activity E
Mention three more examples each at off-line' and 'on-line' real-time systems with a brief
description of its function.
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
_________

6.9 SUMMARY
Effective application of computers is heavily dependent on software. Both system programs and
application programs are required.
More sophisticated computers and operating systems that could hand i.e. job-to-job transitions
were developed as time passed. Job-control statements were used to tell the computer what to do
next in batch or stacked-in- processing, On-line direct access systems were developed to process
input transactions in random order as they were received, and to assist it individual users in
problem solving.
In a multitasking system more than one program at a time resides in primary storage. The
processor executes instructions from one program, then instructions from mother program and so
on. Keeping the processor busy in this fashion helps to maximize the amount of useful work that
can be accomplished.
In a multiprocessing system instructions from the same program or from different programs are
executed simultaneously on two or more processors. Today's personal computer systems as well
as large system configurations may haw multiprocessing capabilities. A real-time system
provides output fast caught to satisfy user requirements. It can be used to control real-life
activity. It can be used to control real-life activity. Time-sharing allows several users to interact
with a system on what appears to be a simultaneous basis. The systems users are shared amongst
them.

In a virtual-machine environment, each user is able to use a total computer system -"both

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hardware and software - that does not actually exist but seems to. Many unrelated virtual
machines running different jobs can be active on the system at a time.

6.10 SELF -ASSESSMENT EXERCISES

1) Explain in detail, with examples, what are the characteristics which go into the, making of a
high-quality system/program.
2) What are the various methods which can be selected for system implementation? Try to
include in your, answer the on-line system implementation, suitability/unsuitability of each of the
methods you describe.
3) What are the features of a language which should be considered for its selection in the design
of a system? Explain your answer with special reference to on-line systems.
4) Explain what is system software and its significance in on-line system design.
5) Explain how problems in real-time scheduling are handed.
6) Explain and distinguish the following concepts with reference to their use in real-time
systems:
i) multiprocessing
ii) time sharing
7) Explain the concepts of synchronous and asynchronous system software.

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UNIT SEVEN
IMPLEMENTATION AND
CONTROL OF PROJECTS

Objectives

After going through this unit, you should be able to:

 Appreciate different approaches to implementation
 Understand the various steps involved in successful implementation of projects
 Appreciate the problems of security and control of MIS system.

Structure

7.1 Introduction
7.2 Project Implementation Options
7.3 Steps in implementation
7.4 Precautions in Implementation
7.5 Security and Control
7.6 Self-assessment Exercises

7.1. INTRODUCTION
The activity of MIS Project implementation can start only after a complete and detailed MIS
design has been formulated and is available for implementation, for only a detailed design will
specify as to what is to be implemented in its absence one doesn’t know what to do his also
assumed that the design which is available for implementation has been reviewed and tested as to
its viability lies one of the end-activities in the detailed design Stage. This minimizes the
possibilities of delayed detection of system logic errors and avoids or reduces the need of
redesign/change efforts during implementation: Frequent occurrence of such errors adds to cost
as well as frustration of implementing team.

7.2 PROJECT IMPLEMENTATION OPTIONS

After review, testing arid evaluation of the completed design, the top management authorizes the

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implementation. One or a combination of several approaches to implementation can be
considered and chosen. The approaches are when the old system does not exist.
1) Install a system in an organization which is just coming up. Therefore the existence and
replacement of old system does not arise. In this case more problems of system logic error,
debl1ggingand redesign and change in the given detailed design are expected and should form
part of implementation effort.
When old system is in existence
2) Cut off the old system and. Install the new system. Because installation is a time-consuming
activity which may take days or months depend on the size and complexities of the organization
and the enormity and complexity of the system. Therefore, there is a time lag when the old
system is cutoff and the new system is not fully operational. During this period no system is in
operation.
Obviously this method would be applicable for very small companies or small systems which
can be installed in a day or two.
3) Cut over by segments Small parts or subsystems of the new system replace the old system one
by one or in groups. So the assumption is that identical or more or less similar parts exist in both
the systems would lead to the conclusion that the 'new' system is not really new: at best it may be
an up gradation of the old one. Another implication is that the parts are independent or
interaction among them is restricted.
4) Operate in parallel and cutover. The new system is installed Without scrapping the old system.
For Some time both the systems operate simultaneously the results of the new system are
compared with the, old system for accuracy and reliability until the new system starts
satisfactorily operating and the old system is dropped. The major advantage is that it helps in
almost completely checking out the new system through comparison with the old system. But it
involves complete duplication of work and as such is comparatively expensive. It is essential
where implications of error in the new system can be very costly or highly embarrassing for the
long term reputation of the company.

7.3 STEPS IN IMPLEMENT A TION

The steps in implementation which are listed later on are equally applicable with minor
variations. to any of the above listed options. It is assumed that the design specifications provide

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general as well as specific details regarding all requirements of that system such as: procedure
forms, database, equipment, personnel facilities etc. The major steps are based on these
specifications. It may be noted that the steps are not sequentially exclusive they usually overlap.
The steps are:
 The Plan
 Space and Layout
 Manpower and Organization of MIS
 Training for Operators and Users
 Hardware Equipment Installations
 Program Development, Design of Forms and Files
 Testing and Changeover.

7.3.1 The Plan

This is a pre-implementation activity where identification of all activities required in
implementation is done. Their sequence and relation to each other is ascertained. Time and cost
estimates for each of the identified activity are obtained.

For very small projects, plan and the sequence of implementation of activities may be undertaken
informally or in text form. But the use of Gantt Charts or network diagrams-CPM or PERT is
very valuable in providing visually a clear picture of the total plan. It is helpful later on for
control function over actual stages of implementation.

7.3.2 Space and Layout

When a new system is to be installed in a completely new company where old system does not
exist, floor space and layout is required for housing the people and the facilities; even in those
cases where the old system is to be replaced by a new system, revisions in the existing floor
space and layout may be required. In certain cases, these may be major revisions.
The MIS project implementation manager is expected to prepare estimates of floor space
requirements and also rough layouts. These would be based on the knowledge and expertise of
the project manager and the required specifications available in the detailed system design. In.
consultation with and approval of the top management, the acquiring or generating building of

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specific space is done.
The layout tikes into consideration locality of facilities in relation to each other ~.g. computers,
terminals, etc.; location of people through partitioning or grouping together or - where required -
allocating separate offices and cabins. Achievement of people and equipment, storage, air-
conditioning, utilities, safety and security factors also affect the layout and location.

7.3.3 Manpower and Organization of MIS

In the first instance, a project manager who should later on take charge of the whole MIS
department should be appointed as its head or somebody from accounts, finance or computer can
be deputed as a stop-gap arrangement with full implementation responsibility. This position
should be available right after the design work so that implementation plan is taken up by the
project manager.
The line managers, line functional and operating personnel must be actively associated with the
implementation. They should feel that it is their system. At development and design stage also
active involvement through all stages of these personnel (system users) advocated. The systems
specialists are assigned to the various phases/parts of implementation and to assist the line people
(the users). The contract/subcontract/assignment may be given to internal or external coups as
the work progresses e.g. the work of building, painting, and electrical conditioning installation
etc.

The other MIS personnel such as systems, manners, analysts programming people, operating
people, data entry people, secretarial and other staff may continue to be engaged as and when
needed depending upon the progress of work. A personnel requirement chart showing the
number of persons in terms of skill and qualifications' should be prepared. It should also show
whether they are internally available or recruited from outside, and the date when they would be
needed according to implementation plan. But their recruitment and selection is to be planned
before and whenever old system siblings placed, the old employees must be adjusted at
appointee jobs through restructuring upgrading etc. If necessary, they may be provided with
additional training .in the meanwhile.

7 .3.4 Training for Operators and Users

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The training is required at two ends, the MIS department people (all levels) and the users at
different levels engaged in different functional areas.
The training for MIS department people must be arranged with respect to procedures and
operations of inputs, formats, processions, outputs, frequencies, destinations, the terminals and
equipment operating. The training is a must whether an entirely new system is being
implemented or an old 'one is being replaced. All operating and supervisory people, through
training, must become completely familiar with their job functions and the system of which they
are a part. This can be achieved through a judicious mix of theoretical input (discussion and
familiarization with system procedure) and practical training on the equipment in actual use.
They must get a chance again when the system is at the last stages of implementation to develop
complete familiarity with the installed system atid1heir respective job functions.

Proper user training is an important factor in promoting the acceptant of the new system and
making it a 'success. The training may be for a specific luggage, or package or general user
understanding of .the system. The Users must now what the system can do for them (in relation
to their job functions) on routine as well as on special request basis. How can they use the
system? How and when can they make the request? The users should be able to appreciate as to
what is available and what can be made available. If some formats ate introduced, they should be
made familiar with it. When terminals are made available to the users, they must be fully trained
to make use of it. The users should understand the challenge procedures the changed codes pass
words etc. If there are changes in the hardware or software the users should be familiar with it to
the extent it is relates to them or their job functions. The users can be classified differently such
as developer versus non-developer novice versus expert, frequent user versus occasional and
primary versus secondary user. These classifications are not necessarily exclusive; more often
they are likely to overlap. User training programs must cater to specific needs of all types of
users. The utility of a system is enhanced if users genuinely feel that the system is helpful' to
them and n1ake active use of the system.

7.3.5 Hardware Equipment Installations

The acquisition of computer related hardware is a complex and specialized subject. Apart from
identification of specific equipment from a wide range of prices, capabilities and vendors the

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question of buy rigor leasing is also related to it. The related equipment requirements and
estimates are available from detailed design. The purchase orders should have been placed earlier
depending upon the estimated supplier time lag. By the time the equipments are. received, site
preparation work, room layout, air conditioning, electric connections, communications link lines
etc. should be complete or near completion so that not much time is wasted in installation and
making the equipment operational. Testing of equipment and training of operating people on new
equipment should start as early as possible. At appropriate times the orders for tapes, disks,
paper, filing cabinets etc. should also be placed.

7.3.6 Program Development, Design of Forms and Files

There are two options available for meeting the software requirements (i) obtain software
packages or (ii) develop software initially. Usually a judicious mix of the two is the best way out.
Small companies may purchase most of the, software, but' usually, some modifications are
necessary to fit it to the company's specific requirements~ It can also be custom made by many
specialized software development agencies.

For large companies, or for organizations with very specialized and complicated requirements, a
majority of the requirements may be met through in-house development of the programs.
Forms required, for inputs, intermediate stages and for outputs are necessary to ensure that the
'right' information is supplied in a manner that simplifies computer storage, retrieval, and
processing as well as user utilization. Even though certain specifications on forms are available
in the detailed design, this is the first opportunity to try out in practice. Necessary changes
modifications, if any, should be made. Standardized forms are a great help to both the end-users
as well as system operating personnel. Even when a user is working directly on a terminal, the
screen format should reflect be document layout wherever feasible for input, processing, as well
as output.
.The identification of files and specifications such as file name, maximum number of characters
required recording each data element for each file, frequency of access, retention characteristics
updating frequencies, formats etc. are developed at detailed design. The conversion of these
specifications into computer programs is the function of computer experts. At that
implementation stage this conversion takes place and initial testing is conducted from actual data

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obtained and recorded. This may be, termed as creation and testing of the physical file. Testing is
done forage, volume, data validation and, file operation procedures including input, retrieval and
updating etc.
Master file is the one which contains data used in rotate processing. The structure of information
is more specific in these files. These are comparatively permanent in control there are transaction
files, which are created for specific-transaction purposes only and are temporary. There could be
soJ11eother, files which may be used for capturing and storing data about the environment. The
structure of information in' these files may not be as specific the procedures are developed for
access to files, input, update and delete frequencies for file and data protection, for input data
validation. Indexes and retrieval procedures are also developed.

7.3.7 Testing and Changeover

Testing is a very important part of the implementation phase. Even though testing is basically a
part of each phase, it is critically important at this stage because here the testing is done under
actual operating conditions with real data. It can take up 15 to 50 percent of the total system
development effort depending upon size and complexity.
Usually a hierarchy of testing is advocated at, different levels, starting from individual programs
to subsystems and finally to the system as a whole.
At the component level-individual components file input forms, programs, output forms, work
procedures etc, may be tested using representative or limiting/unusual data for accuracy range of
input and processing, operating conditions reliability etc. At individual application level again
using the actual data from the present data banks for its functioning logic, input-output etc. each
individual application at operation level is to be tested.
At subsystem level- the testing is directed to verification of multiple input, output, complex logic
interaction and interfaces of various lower level subsystems which form part of this subsystem.
At any of these testing levels difficulties or errors may be experienced which in turn may require
changes in forms designs, logic, sequence, workflow, output workflow, procedures, interaction
of subprograms etc.

Cutover is an event signifying the actual replacement of the old system by the new system. The
old system is completely dropped and the new system is fully operational, Despite repeated

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testing at each of the phases and careful testing at the last stage of the implementation phase,
there are still likely to be minor as Well as some major problems with the new system when it is
fully operational and facing the real world challenge. The appearance of errors is inevitable as
the system operates in varying combinations of volume, transactions and conditions which could
not have been foreseen. The process of overcoming these difficulties in computer terminology is
called 'debugging'. This process of debugging continues for several days to several months’
depending-upon the size and complexity of the system.

When the system becomes operational, it has to be maintained at an efficient level with respect
to equipment, processing, outputs; inputs etc. there have been various estimates and it can be
safely concluded that for an average operating system the maintenance effort is around fifty per
cent of the total operating effort. The classes of problems, that are definitely errors and need to
be corrected in time, fall in the category of maintenance. Apart from maintenance, the requests
for modifications and improvement will also continue to be, received over the life of the system.

7.4 PRECAUTIONS IN IMPLEMENTATION

Even though the implementation process has been discussed in fairly great detail, some
important aspects are further discussed which if overlooked would have been the cause of failure
old large number of MIS projects.
1) The quotation or equipment: The question of equipment should be viewed in terms of
organizational -information need rather than being limited or created because of equipment.
2) The Software: The software and the processing logic should be error-free. A small error at
any of the input or process or logic stages can result in very serious blunders. A thorough and
repeated planning and review at each stage is a must.
3) Testing: Wherever testing is recommended or desired as part of design or implementation, it
must be done meticulously according to standards given. This is one activity where 'Cutting
Comers' or carelessness can be very catastrophic.
4) Controlling: Many small jobs taken together make a project. The identification of tasks was
undertaken in the imp1ementationphaseitself. Successful completion of each of these tasks in
respect of time cost and efficiency must be carefully monitored.
5) User Participation: One of the most prominent causes of failures of MIS had been non-

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acceptance by the users: User participation must be intensively encouraged and sought at all
phases and more so at the culmination stage of the total development process i.e.
implementation.

7.5 SECURITY AND CONTROL

Data and information stored and maintained as part of total MIS activity is a very valuable asset.
of the company. The physical equipment also is costly and valuable. The problem of security is
two pronged-security of physical assets and security of intangible assets i.e. data. There could be
three types of security problems: (i) Frauds (ii) Sabotage (iii) Accidents and Disasters.
These security problems can be overcome through:
i) Control on physical access to equipment: This can be achieved through usual security
procedures i.e. Building security, proper locking system, proper entry restrictions, guards, alarms
etc. The problem is slightly more difficult when distributed data processing or networks are in
operation. That would mean keeping safeguard control on all the terminals.
ii) Access to data: Data availability to unauthorized persons irrespective of the fact whether
physical access to equipment is valid or not should be prevented. As such specific: identification
codes or pass words are used for specific terminals, for specific files and specific working hours.
iii) Splitting the work: The critical work packages like programming efforts where possibilities
of fraud exist, must be split between more than one person.
iv) Semi-disconnected distributed system: Provisions in a distributed system should include
procedures for switching/shifting processing to alternate location in case one local facility is not
functioning. The capability to continue processing at all sites except the non-functioning one is
called 'fait-soft' protection.
v) Back-up and Recovery: This is sometimes called 'disaster management'. All systems are
required to recover from errors and failures, fire, floods, accidents, natural disasters or deliberate
damage to equipment, software and data. Apart from other precautions such as safe locations,
fire and smoke detectors alarms, automatic power off, back-up power supply, insurance etc.,
following provisions. maybe incorporated:
- Back-up copies of important software and data are stored at alternate sites off the premises;
- Back-up recovery plan.
- Alternative management for stop-gap utilization of equipment facilities. It could also be done

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through mutual inter-department or inter-corporation facilities dependence in case of need.
-Backup supply of forms and other supplies.

7.6 SELF-ASSESSMENT-EXERCISES
1) How much importance should be accorded to implementation phase as part of the total MIS
development activity? Explain.
2) Briefly discuss the various implementation strategies. Under what circumstances are they
suitable?
3) Describe the major steps in implementation of MIS design. Are they overlapping or
exclusive? Explain.
4) Discuss appropriate measures for security of data.
5) Explain the methods in backup and Recovery/Disaster management. Why is it so important?

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UNIT EIGHT
TRENDS IN INFORMATION-
TECHNOLOGY-HARDWARE,
SOFTWARE

Objectives
After going through this unit you should be able to
 Understand the evolution of Information Technology with raped to Hardware and
Software.
 know about the role of expert systems in the evolution of information Technology
 learn about the kinds of a required for the hardware and software systems used in
Information Technology

Structure

8.1 Introduction
8.2 System Development.
8.3 Historical Development of Approaches to Algorithms for Information Systems
8.4 Microprocessor Based Systems
8.5 Novel Feature RDBMS/4 GL Environment
8.6 Evolution of Software Systems
8.7 Expert Systems
8.8 Expert Systems in Decision-making
8.9 Benefits of Open System
8.10 Data Modeling Concepts Evolution
8.11 Role of Computer Networks
8.12 Building up of People
8.13 Summary.
8.14 Self assessment Exercises

8.1 INTRODUCTION

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With computers occupying the centre stage in the modem world's information systems area, it
would be interesting to trace the history of computers. However, before going into its history,' it
would be fruitful to examine the components which go into the building up of computer services
since to Some extent the history of the components can be traced separately. Still, it should be -
noted that advancements of hardware and software went along hand in hand as time passes.
Computers can broadly be sub-divided as shown in figure 8.1.

Computers

Hardware Software

System Application
Software Software

Influenced and designed by

what may be termed as
people ware
Figure 8.1 Parts of a computer

The computer industry is today the fastest growing in the world. The rapid growth accompanied
by more and more sophisticated technology has resulted in hardware becoming progressively
more powerful and compact and at the same time much cheaper. These falling hardware prices
have practically reversed the hardware to software cost ratios.
The changing economic balance between hardware and software has resulted in formalization of
the software development process. What used to depend solely upon the skill and art of the
software developer, power is aided by structured methodologies and automated productivity
tools. Software development which was more of an art has now become an engineering

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discipline.
The advent of technology and reducing hardware prices has resulted in a widespread
proliferation of computers. There has been a considerable amount of development in the area of
Software Development tools and Data Management utilities. Very good .relational database
management products are available today on a wide range of hardware platforms: Most of the
relational database management products are supplied with fourth Generation Language products
for software .development. This has changed the environment of software development
substantially. Hardware also has undergone a sea change from the first generation valve-based
computers to the fourth generations very large scale integrated circuits.

8.2 INFORMATION SYSTEM DEVELOPMENT

Since we are examining the development of computers with respect to Information System let us
examine the stages of Information System Development. These can briefly be summarized as
under:
1) Requirement Analysis: Study of the existing system and determination of requirements of
User Preparation of System Study Report.
2) Systems Design (Logical Design): Conceptualization of the New System based on System
Study Report prepared in step I above. Preparation of detailed specification of algorithms to be
used in the programs Preparation of detailed Database Design. Specification pf interfaces
between all programs to make a system. The hardware platform operating system file system
(conventional or database) and programming languages .available are important considerations
in the above design.
3) Development of Prototype
4) System Design (Physical Design): Partitioning of the system into programs. Preparation of
detailed specification of algorithms to be used in the programs Preparation of detailed Database.
Design Specifications of interfaces -between all programs to make a system. The hardware
platform, operating system file system (conventional or database) and programming languages
available are important considerations in the above design.
5) Preparation of test data for individual programs as well as or system link testing.
From the above we can see that the stage which is affected most by changing hardware and
software platforms is the Physical Design phase of System Design.

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8.3 HISTORICAL DEVELOPMENT OF APPROACHES TO ALGORITHMS FOR
INFORMATION SYSTEMS
We will now develop the conventional approach to algorithm for information systems vis-à-vis
the hardware availability.
First and second Generation Computing Environment
Hardware: - Single user machines with limited memory
Data Storage and- 1.Magnetic tapes
Retrieval 2.Low capacity disks
Input device- Card Reader
Output - Line Printers
System Software - No Operating System
Language - Machine Language in First Generation computers an Assembly Language in
Second Generation computers.
The above environment was one of batch processing and primarily involved the use of sequential
file, system on tapes.
As a result of these restrictions the following approach was used in file design:
i) All the required fields of data whether maintained in another file or not should be available.
ii) In case of Master-detail kind of data relationship both types of records to be maintained in one
file itself.
iii) About 10% of the record size to be kept blank in the record as provision for future addition of
fields.
iv) Sequence of the file should be well defined. Each file must have an order of sequence.

Guidelines for program algorithm design were as follows:

i) Check order of sequence of all input files.
ii) Use standard two file matching algorithm for Master-transaction file processing.
iii) Maintain counts of 'input files' records read and output files record created and tally.
iv) Use Data area of memory for overlaying, housekeeping routines etc., in case of long code
v) Create temporary files for use in next program.
vi) Maintain sequences of all output files. Since the language of programming was machine

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language: in first generation computers and ‘Assembly language' in second generation
computers, it is implied that code for all tasks had to be explicitly written. However, there was a
facility of Macros which was used for file handling and other commonly used repetitive
functions in second generation computers only.

Third Generation Computing Environment

Hardware - Multi-programming machines with a little more memory.
Data storage - 1. Magnetic tapes primarily as backup and retrieval medium
- 2. Magnetic disks with larger capacities.
Input devices - 1. Card Reader
- 2. Operator's Console
- 3. Tape Drive
Output devices - Line Printers

8.4 MICROPROCESSOR BASED SYSTEMS

With the advent of microprocessors mare and mare CPU power and memory is available at a
much lower price. This phenomenon bas increased' the number of machines in the market. With
this the importance of End-user computing was realized. Several user-friendly, easy1a learn
software tools are available and widely used.
In India the computing environment is dominated by the Unix-based microprocessors based
systems, on these systems many Relational Database Management Systems with fourth
generation language are available. Fourth generation Language, like COGEN, are languages
whose single statements generates series of higher-level language statements, like COBOL in the
case of COGEN. The trend is therefore to develop systems using random database management
systems for data management and fourth generation languages for a program development. This
environment helps in increasing software development productivity.

8.5 NOVEL FEATURES OF RDBNS/4 GL ENVIRONMENT

Some salient features of Random Database Management System/Fourth Generation Language

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Environment are as follows:
1) Powerful and versatile; Query language in set (de facto industry standard) is available.
2) Table level operations of Join. Select and Project are available.
3) These are event/action oriented languages.
4) Several routine tasks don't have to be specifically programmed: as they are automatically
taken care of.
5) Excellent Report generation facilities are available.
6) Excellent forms/screen handling facilities are available.
7) Integrity and validity of data is ensured by building the controls into the Database Design
itself.

We also find that previously hardware used to be standard for all applications-in first generation
computers, whereas, with the sophistication of technology, hardware sizing study needs to be
done now, depending on the application and system software used.

8.6 EVOLUTION' OF SOFTWARE SYSTEMS

Software has evolved from single transactions to batch sequential processing to batch indexed
sequential processing to batch random to real-time systems . Figure 8.2 gives the trend of
software development in detail.

Single transaction processing

Scheduled operation Batch sequential processing
Batch indexed sequential
processing
Software
Batch Random
Development
trends
Non-interactive
Non-interactive
On demand operation Response as soon as
possible
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 Slow response
time(Mins)
Interactive (Real time)
Fast response
time(secs)

Figure 8.2 Developments of Software Systems

Another significant feature in software development is the addition of secondary, key inquiry of
retards to primary key inquiry of records and then to databases needing a search of higher kinds
of inquiries as shown in figure 8.3.

Give examples-from your experience of the various trends of software mentioned in the two
diagrams in this sub-section on Evolution of Software System.
______________________________________________________________________________
______________________________________________________________________________
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8.7 EXPERT SYSTEMS
Expert systems, the latest tools are provided by the fifth generation computer technology, not
only to- aid the manager in the process of decision making, but also to suggest alternative
solutions and to guide him in taking decisions. These tools till now are yet to catch up in our
industry and business and that will be the future tools to the manager in the process of decision -
making. Expert systems are very closely related to the decision-maker, not only in decision-
making, but also in giving expert advice and guidance to the decision-maker by capturing the
domain specific knowledge. A right decision can be taken at the time--only When right
information is sailable to the right man, in the right form, at the right time. Right decisions can
be taken in the light of information; without information, decision-making is very difficult. The
information provides the basis for decisi08~inakin.. Decision-making is the process of selecting

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course of action from among the alternatives available. Up-to-date knowledge about the
environment is very important for right decision-making. The decision-maker must be able to
analyze, evaluate and reason with this knowledge in appropriate ways.
An effective decision has two important components viz. timeliness and Correctness. A decision
will lead to a successful result only when the decision is right. Still it will have its impact only
when it is taken and applied at the right time. Hence we can define knowledge as the power or
skill in a human being which guides him in taking timely decisions. The basic ingredients in
decision-making are data and information guided by specialized knowledge. Data is a set of
compiled facts. These can be arranged in a logical manner 'to convey meaning, which is
information. Processing this information requires knowledge; comprising judgment, experience
and reasoning, to reach a decision; to take an example, sales invoice information is 'data', which
on compiling and processing gives sales 'information', that is, sales reports .and forecasts. The
'knowledge' of the sales manager is utilized in generation of sales plan evaluation and resource
allocation. Expert systems are the tools which capture this domain specific knowledge and
suggest aid and guide in the decision-making process.

8.8 EXPERT SYSTEMS IN DECISION-MAKING

Expert systems are computer programs which make recommendations and draw conclusions
from rules of thumb and from Relationships derived out of human experience. Expert systems
are proving useful in practically every area. From quick and easy retrieval of context sensitive
information to in-depth analysis of an investor’s stock portfolio, expert systems ate becoming an
important t091 in helping managers to make decisions. They can- be successfully applied to
almost any situation where rules of thumb or heuristics are used to make decisions. We can make
use of expert systems in every area in' industry from configuration of complex equipment to
subassemblies, cost and time estimation, the interpretation of large amounts of data, data
analysis, engineering design and diagnostics. Diagnostics of machinery forms the largest simple
application class of expert systems. Financial decision-making represents the fastest growing,
and one of the largest growing expert system applications. Closely related are insurance,
underwriting and, routine office procedures that are complex, requiring some expertise.
Manufacturing planning and scheduling is another rapidly growing application. One of the most
surprising applications is sales. The spectrum of applications is astonishingly wide and is

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extremely complex.
Expert systems are useful at all management levels. Planning and prediction are computer
Networks the major activities at the top level. The planning activities are: expansion, investment
planning, raising fresh capitals make or buy analysis and dividend decision. The predicting
activities are: projection of growth, and forecasting future income. For example, we can have
expert systems in determining rising of new, capital. It involves considerations of several factors
such as current economic environment the position on the stock and bond market and the
existing capital, structure of the firm. Econometric procedures can be applied to predict the trend
in these factors. The results can then be combined with the capital structure; of the firm the
anticipated costs of capital cash outflows and the factor. Similarly we can use expert systems for
make or buy decisions.
The decisions involve the setting up of shutting down of a production unit line against the
alternative of purchasing the item. Expert systems can help make a decision’s for the short run
by Estimating various costs associated with each alternative control design monitoring prediction
and training are the major activities at the middle management level. Establishing control
systems, budgeting, cash flow analysis framing customer credit policies forecasting income,
expenses, and growth rates instructing junior professionals in analysis techniques are activities at
middle level. Expert systems can be developed in toe areas of framing customer credit policies
monitoring are the activities at the lower levels. Diagnosis involving management housing and
loan and' credit analysis. Interpretation cost and manipulation of financial data. Monitoring
involves reprieving and control activities of things like accounts payable and receivable. Expert
systems can be developed in areas where human skill and knowledge are required. The possible
applications are virtually endless, including both small and large expert systems in areas such as:
 Establishing sales quotas
 Conducting trainee orientation
 Recommending acquisition strategies
 General project proposals
 Job shop scheduling
 Facilities maintenance
 Selection of forecasting models
 Determining credit limits

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  Selecting transport routes

Activity C
Mention, five other uses of expert systems in the business field.
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________

8.9 BENEFITS' OF EXPERT SYSTEMS

Expert systems improve the quality and consistency of 4ecision-making they improve the
efficiency of the decision making Process. They can also be used as knowledge spreading tools
for training the staff. There is a vast scope to develop expert systems to support different levels
of staff in all areas. With the appearance of tools specifically designed for developing business
expert systems, managers and business computing professionals can no longer regard the topic of
expert systems as an intellectual curiosity or the domain of a selected few. Any repository of a
problem solving expertise that exists in organization is a candidate for expert system
development – be it secretarial expertise or knowledge about solving strategic management
problems. Expert system technology has already advanced to the point at which it offers
innovative and most effective solutions to a wide range of industrial problems. Over the next
decade further improvements in methodologies, new hardware architectures and more powerful
software will result in expert systems being introduced into almost all areas where expertise is
routinely applied. Expert systems are still in their fledgling stage. The next decade or two should
see tremendous growth in advancement and utilization of expert systems.

8.10 DATA MODELLING CONCEPTS EVOLUTION

Over the years, the emphasis in the program methodology has shifted away' from the design of
procedures towards the organization of data. This paradigm is often known as data hiding
principle. The focus is on the partition of programs into modules so that data is hidden in

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modules. In PASCAL, variables defined in the main program may be used by any procedure
defined in it. The only mechanism to hide a name from the rest of the program is to define the
variable in the procedure. This results in procedure nesting. In C a module is defined by grouping
together the related functions and data definitions in a single source file. The programmer has
control on the names to be seen by the rest of the program by declaring them as 'static' or
'external'. A name can be seen by the rest of the program unless it has been declared static.
Modula-2 supports this technique by making it a fundamental language construct with well
defined module: declarations and explicit control if scope of names.
Programming with modules leads to the centralization of instances of a type under the control of
control manager module. A type created through a module mechanism from built-in types.
Languages such as Add handle this problem by allowing user defined types known as Abstract
Data Types (ADTs) that behave much like a built-in type. The basic support for programming
with ADTs consists of facilities for defining a set of operations (procedures or functions) for and
restricting the access to variables of these types to this set of operations only. An ADT, once
defined, does not adapt to new uses except by modifying its definition. Programming with
general ADTs masons distinction between the general properties (attributes and operations) of a
type and properties specific to a type. For example, it is not possible to establish that instances of
the type CLOSED-POLYGON have some properties which are common to instances of the types
TRIANGLE and SQUARE. A language with constructs that allow this distinction to be
expressed and used supports object-oriented programming. The focus is on the design of classes
and a full set of operations for each class and a mechanism that allows inheritance through class
hierarchies.

In the object-oriented approach the essential idea is that data and produces are represented in a
structure called object. In traditional programming systems, data and procedures are separate
entities. The programmer is responsible for applying active procedures to passive data structures.
In contrast, is object-oriented systems, instead of passing data to procedures, the objects are
asked to perform operations on themselves? In traditional languages, routine to perform any
function is directly invoked by the program or another routine. In Object-oriented languages
functions/procedures are invoked indirectly. Proceeding further, a database is a collecting of
stored data together with their description and interrelationships. A database is supposed to

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represent the semantics of application as completely and accurately as possible. A data model
provides a framework of concepts used to express the semantics of application. In classical data
models (hierarchical, network or relation or one of their derivatives, there is a considerable gap
between the semantics of an application and the semantics of an application as represented
within the database. This is because the semantics of an application may be modeled as it set of
entities and relationships among them at various levels of' abstraction. In classical systems this
abstraction is not possible. This is primarily due to the act that only atomic data can be stored in
these systems. This is where object-oriented database systems come in, as they support the
concept of data abstraction. Moreover, these systems are based on data models that allow one to
represent a real-world entity however complex its structure may be by a single object in the
database. However, the object may be composed of other objects. This is accomplished by
building the domain (called data type in programming languages such as PASCAL and C) of an
aerobatic of a class (or relation) to another class (or relation): For example, an attribute 'division'
of a class UNIVERSITY may be bound to the class EMPLOYEE. Thus object-oriented systems
support modeling of complex entities and relationship directly.

8.11 ROLE OF COMPUTER NETWORKS

The role of computer networks in information systems has gained increasing importance with the
fast pace of improvements taking place in technology today, Computer networks in simple
language are computer systems and devices interconnected with each other by means of
electronic cables or satellites. They enable pooling of information for use by a wide class of
people distributed over a wide geographical area by means which provide faster access to
information, Combination of artificial intelligence with computer networks has led to enhanced
Information exchanged storage and retrieval possibilities.

8.12. BUILDING UP OF PEOPLE

Information processing and computer processing are people-intensive. People are, the most
important and basic resource in this sphere. There is worldwide shortage of Information
Technology people with the needed skills; knowledge and experience over the coming years, this
shortage will grow. Some of the reasons for this shortage have to be recognized and analyzed

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carefully.

The software industry is growing at the rate of 15 % per annum and this rate is increasing. The
increase in the growth of software demand can be ascribed to the following factors:
i) Software systems are becoming large and complex. For instance, USA's manned space
program in 1962 accounted for 1.5 million lines of code whilst in 1985 it
was 80 million lines of code. Software systems require:
 Adherence to time schedules
 Working within cost estimates
 Conformity with quality and reliability standards
 Maintainability and maintenance
 Adaptability to medications and extensions
 Operational efficiency in user environment
 Sensitivity to life-cycle costs and not only to initial developmental costs. All these
requirements increase the complexity and work required.
ii. Software estimation is still an art and there is usually an underestimation of projects. Over
runs have become the rule, and projects are much behind schedule.
iii) For the first time it is being realized that hardware and software have a useful life in the field
of information technology, While the life span of software is more than that of hardware. it is not
indefinite. Many of the existing software systems have become obsolete. Newer systems are
required to meet the increased complexity of operations and to make use of advancing hardware
technology.
iv) There are huge backlogs of software development with almost all kinds of organizations are
forced with backlogs of more than four years.
v) Skills required in software development today arc less of programming and more-of analysis.
Computers can now do most of the programming through program generators, Fourth generation
language, and Sequential Query Language and database languages. Programming skills by
themselves are no, longer sufficient.
While there is growing realization of the importance of Information Systems: business. industry
and the government are finding that there is an acute shortage, of trained professionals. There is
considerable leeway to be made in building up people of the right celebrate who would bring

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about the information revolution. Development of the manpower for accelerating the progress
towards the Information Age calls for effective steps in selection, recruitment, training
continuing education and career development of software and hardware people. Only if we rake
such comprehensive steps aimed at choosing and building up the right people and providing
them Opportunities of growth and professional advancement, will we he able to harness the full
Potential of information systems.

8.13 SUMMARY
The managers of today's complex and diversified businesses must have Up-to-date knowledge of
company operations in order to serve their customers and control their' business activities. This
need calls for rapid collection, processing, and distribution of large amounts of business data.
Efficient, dependable data-collection, and data distribution capabilities are particularly' important
in cases where geographically separated facilities are controlled from one central facility, or
where operations at one facility have a direct bearing on Operations at another.

With the increased recognition of the potential of electronic data processing more and more
business applications have been computerized. Because data collection or distribution by mail,
courier or carrier is slow and subject to both traffic and weather conditions, other types of data
transmission are needed. Initially attention was directed to telephone and telegraph' facilities.
The latter provided printed copies of whatever was transmitted. However, electronic data
processing Has now established itself in the Information Systems, field.

We conclude by summarizing that the vast range of data-processing data-communication

capabilities that arc currently: available from computer service companies has enhanced the
significance of information systems.

8.4. SELF-ASSESSMENT EXERCISES

1) What are expert systems and bow do they help in decision-making? Can you give examples to
illustrate the same?
2) What kinds, of decisions can be appropriately programmed on expert systems? Give
Examples.

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3) Trace the evolution of data modeling concepts with examples which are different from the
ones given in the preceding text.
4) Write a short note on people culture in information technology.

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