Management Information Systems (MC261) : April 2006

Section A : Basic Concepts (30 Marks)
1.Low-volume data and analytical models are characteristics of which of the following Information System?
(a) Management Information System (b) Decision Support System
(c) Executive Support System (d) Transaction Processing System
(e) Office Automation System.
2.Networks within an enterprise that are similar to the Internet are called
(a) Intranets (b) Extranets (c) Teranet (d) WAN (e) Webnet.
3.The primary difference between program testing and system testing is:
(a) System testing focuses on testing the interfaces between programs, whereas program testing focuses on individual programs
(b) Program testing is more comprehensive than system testing
(c) System testing is concerned with testing all aspects of a system including job designs and reward system designs
(d) Programmers have no involvement in system testing, whereas designers are involved in program testing
(e) Program testing is for Managers and system testing is for workers.
4.Which amongst the following is the characteristic of a closed decision-making system?
(a) The manager has a known set of decision options and knows their results when fully implemented.
(b) The manager is not aware of all the decisions alternatives.
(c) The results of the decision are not known.
(d) No fixed method or model is available to arrive at a decision.
(e) The manger takes the decision inside a closed room.
5.Which of the following methods of validating PINs seems to result in the fewest control problems?
(a) Allow only a small number of PIN entry attempts, close the account after the limit has been reached, and retain the card
(b) Allow a reasonable number of PIN entry attempts, close the account after the limit has been reached, but do not retain the card
(c) Allow a reasonable number of PIN entry attempts, close the account after the limit has been reached, and retain the card
(d) Allow a small number of PIN entry attempts, do not close the account after the limit has been reached, but retain the card used to initiate the PIN entry
(e) Allow unlimited number & PIN attempts, close the account after the limit has been reached, but retain the card used to initiate the PIN entry.
6.Which of the following is not an assumption about the role of computers in decision making?
(a) Computers are meant to support the manager in decision-making, not replace him.
(b) Computers are the key constituents of an effective decision support system.
(c) Computers help structure the problems and provide a systematized approach.
(d) The key to effective problem-solving is having an interactive and enhanced dialogue between the user and the system.
(e) It helps the manager to arrive as the most optimum solution.
7.Businesses like airline, banks and online services are adversely affected by natural calamities. Such organizations therefore, develop
(a) Disaster recovery mechanisms (b) SOS systems (c) Network architectures (d) Firewalls (e) Accounting systems.
8.Which of the following systems caters to the strategic information needs of the top management?
(a) Human resource information systems (b) Expert systems
(c) Executive information systems (d) Reporting systems (e) Accounting system.
9.Which of the following is not likely a support provided by a Decision Support System?
(a) Identify the need for decisions.
(b) Solve or assist in solving problems
(c) Provide assistance in the form of advice, analysis or evaluation
(d) Get major market share for the company’s products.
(e) Help compensate for cognitive limitations of human decision makers.
10.Which of the following is true regarding the development of EIS information requirements?
(a) The focus should not be on stakeholder expectations because the organization intends to serve them.
(b) Stakeholder expectations need not be documented.
(c) Determine the various formats in which reporting is done and the frequency of reporting.
(d) The flow of information need not be outlined because it already exists and is obvious.
(e) EIS objectives does not match with the organization objectives.
11.Which of the following is not likely an advantage of the End-User-developed DSS?
(a) Major reduction in delivery time of the application.
(b) Elimination of time consuming process of gathering and formalizing end-user specifications for the system.
(c) Improved profit for the organization.
(d) Reduction of implementation problems following the design phase of the project.
(e) Lower cost of development.
12.Which of the following is central to successful MIS implementation?
(a) Apply latest technology (b) Save on effort (c) Save on time (d) Train the end-users of the system. (e) Save on cost.
13.Which of the following is not a parameter in the Framework that evaluates the success of a DSS implementation.
(a) Industry growth (b) System performance (c) Task performance (d) Business opportunities (e) Evolutionary Aspects.
14.In order to effectively control and maintain an MIS, the management must
(a) Build a review committee (b) Employ latest technologies (c) Conduct periodic tests (d) Employ process flexibility. (e) Change the system frequently.
15.In DSS, many type of tools help in building complex, systems. Some of the following come under complex system tools.
I. Knowledge Disposal
II. Knowledge Acquisition
III. Knowledge Validation
IV. Knowledge Responsiveness
V. Knowledge Verification
(a) (I), (II) and (III) above (b) (I), (II) and (IV) above (c) (II), (III) and (IV) above (d) II, III and V above (e) I, II and V above.
16.Business Process Re-engineering (BPR)
(a) Is the system that provides integrated approach in planning, distribution and control of material resources within an organization.
(b) Is the “fundamental rethinking and radical design of business processes to achieve dramatic improvements in critical and contemporary measures of performance”
(c) Led to the development of MRP-II.
(d) Is the system that provides for planning and control of manpower, material resources and machinery to manufacturing organizations.
(e) Changing the Business of the organization totally.
17.Which of the following is used to monitor the progress of an MIS implementation
(a) Reporting system (b) Mainframe system (c) Localized system (d) Globalized system (e) Processing system.
18.Which of the following is not true about ERP?
(a) There will not be any resistance towards the new system (ERP) by senior employees of the organization.
(b) Effectiveness of ERP is influenced by the extent to which the existing processes can adapt to the change and effectively utilize it.
(c) The kind of customer focus the company has, and the business strategy has an impact on the ERP solution.
(d) Improper evaluation of business processes can lead to problems in ERP implementation.
(e) ERP helps an organization to integrate its functions.
19.Compared with a manual system, the assets and records in a computer based information system tend to be
(a) More concentrated at a single location.
(b) Dispersed across many more locations
(c) Concentrated to about the same extent
(d) More concentrated at different locations but less valuable
(e) More concentrated at few locations but more valuable.
20.Information technology helps in evolving new types of organizations called ________
(a) Electronic conglomerates (b) Connected organizations (c) Virtual organizations (d) Sophisticated organizations (e) Big organizations.
21.One of the following, is not a reason for things going wrong in the development and successful implementation of an MIS.
(a) Lack of clear definition of mission and purpose
(b) Disorganisation
(c) Marketing and Advertising campaign.
(d) No Management participation
(e) Non-performance of key personnel.
22.Which of the following provides data protection over the internet, intranet and extranet?
(a) Encryption (b) Decryption (c) Server software (d) Artificial intelligence (e) Cable insulation.
23.One of the following is not a limitation of a Decision Support System.
(a) DSS’s cannot yet be designed to contain distinctly human decision-making talents such as creativity, imagination or intuition.
(b) Extend the decision maker’s ability to tackle large scale, time-consuming, complex problem.
(c) The power of a DSS is limited by the Computer system upon which it is running, its design and the knowledge it possesses at the time of its use.
(d) Language and command interfaces all not yet sophisticated enough to allow for natural language processing of user directives and inquiries.
(e) DSS’s are normally designed to the narrow in scope of application, thus inhibiting their generalisability to multiple decision-making contexts.
24.The most significant reason for an MIS to fail is
(a) Lack of coordination of the EDP and MIS function
(b) Lack of proper planning
(c) Lack of managerial participation
(d) Lack of proper analysis
(e) Lack of system resources.
25.The use of digital technologies to enable multiple organizations to collaboratively design, develop, build, move and manage products through their life cycles is called
(a) Domestic Trade (b) Export (c) Collaborative Commerce (d) Import (e) Barter deal.
26.Even with the best Management Information System in place,
(a) Managers should be tension free.
(b) Data must not be analyzed and interpreted by managers.
(c) Allowance must not be made for inadequacies or non-availability of data.
(d) Data must still be analyzed and interpreted by managers.
(e) Information should not be view by the managers.
27.The theory of decision making which states that “an individual identifies goal, ranks all possible alternative actions by their contribution to these goals, and chooses the alternative that contributed most to those goals” is
(a) ‘Organisational’ model (b) ‘Bureaucratic’ model (c) ‘Garnage Can’ model (d) ‘Political’ model (e) ‘Rational’ model.
28.If a decision is based on a rule or a method it is called a
(a) Programmed decision (b) Non-programmed decision (c) Semi-programmed decision (d) Set decision (e) Random decision.
29.Currency represented in electronic form that moves outside the normal network of money is
(a) Coins (b) Cheques (c) Debit Card (d) Digital Cash (e) Credit Card.
30.An MIS implementation may not result in:
(a) Enhanced productivity (b) Better time management
(c) Unanimous acceptance by employees (d) Better quality of work.
(e) Better Decision Making Process.

Section B : Problems/Caselets (50 Marks)
Caselet 1
Read the caselet carefully and answer the following questions:
1. Discuss the pros and cons of Plastic India Ltd. present structure of concentrating data department wis(e). (7 marks)
2. What are the problems Plastic India Ltd. might face while amalgamating the company’s data into a single database? (6 marks)
Plastic India Ltd. manufactures a wide range of plastic mouldings. The mouldings are used in diverse products such as motor vehicles, garden furniture and children’s toys. In order to serve this variety, there are six different sales departments, one manufacturing department and an ordering department. A separate IT department provides basic IT services to all the departments.Each department in the company has its own computerized records and databases. The IT department has been very successful in meeting the IT system requirements and providing high quality service to each user department in the past.
Plastic India Ltd. now plans to set up a centralized sales database that every user department can access. The database is intended to be very comprehensive, which will include among other things, details of goods, customers and debtor analysis. This would mean that the individual databases in each department will have to be amalgamated into this central database.
Caselet 2
Read the caselet carefully and answer the following questions:
3. Explain how IEL could improve its procedures to:
i. Ensure that only authorized sales reps have access to the main computer and
ii. Check that the data is completely and accurately transferred between the portable computers and the main court. 4. i What process could IEL use to include the daily order data within B&B’s MIS
ii. Indicate the various outputs that would be expected from the MIS to assist the senior management in decision-making. (7 marks) Indian Explosives Ltd. (IEL) sells industrial explosives which are used in tunneling, road building and demolishing of old buildings. IEL produces more than 500 types of explosives and related accessories.These explosives are sold to customers by highly trained sales representatives. In a typical transaction, each sales rep visits a customer site, ascertains the customer’s requirements and finally confirms the goods availability and lead time using his portable computer. The orders can be complex, involving many different types of explosives and related accessories.
At the end of the day, each sales rep links his computer to the company’s main database. Order details are transferred to the main computer, while updated stock balances are downloaded and are ready for use for the next day. In spite of the fact that the sales reps’ information may not be current, stockouts are infrequent.Every evening, after all the sales reps have fed the data to the main computer, the information is analyzed, production schedules are produced and the company’s management information system (MIS) is updated. Each rep logs on again in the morning and downloads a copy of the updated MIS.
5. “Although Information Systems have provided enormous benefits and efficiencies, they have also created new problems and challenges, of which managers should be aware of”
Discuss the benefits and the negative impacts of Information Systems. (10 marks)
Caselet 3
Read the caselet carefully and answer the following questions:
6. What are the business benefits of Reach’s intranet? (6 marks)
7. How does Reach’s extranet help strengthen its ties with its agents? (6 marks)
Reach Group, a Rs 3000 crore diversified property and casualty insurer, largely bypassed client/server technology on its way to the intranet. It did so partly because of the insurance industry’s conservative stance on technology.
However, the intranet’s simple application deployment and its potential as a competitive business tool drew Reach’s attention. The web provided Reach with the opportunity to distinguish itself with better, more informed services in an otherwise mature market. That meant a way to strengthen ties with its independent agent network. “This has always been a relationship business,” says the director of collaboration solutions.
RealNet, Reach’s first intranet application, was an enterprise wide risk management application that went up last year. It allows over 900 customer service representatives to track the account status and identify risk exposures by consulting a reference database of 40,000 policies and information from content experts on specific types of litigation or claims awards. Users make predefined queries, which offer 10 to 20 variables, against a SOL Server database; that in turn accesses a DB2 database on the mainframe.
When this system worked well, Reach developed an extranet application for agents selling worker’s compensation insurance. In insurance, where the name of the game is getting quick quotes, Reach’s extranet guarantees response time of 10 minutes or less, compared to hours or days in the old way. The company is also planning an extranet admission system for worker’s compensation claims to streamline a costly process bogged down by paperwork.
And for its top customers, Reach is considering adding a premium service extranet involving virtual private networks to get around the uncertain performance of public networks.

Section C : Applied Theory (20 Marks)
8. According to Simon (1960), what are the various stages of a Decision Making Process.
(8 marks)
9. Explain briefly the following:
a. Transaction Processing System
b. Management Information System
c. Decision Support System
d. Executive Support System (4 × 3 = 12 marks)
Suggested Answers
1.
Answer : (b)
Reason: Low- volume data and analytical models are characteristics of Decision Support System.
2.
Answer : (a)
Reason: Networks within an enterprise that are similar to the Internet are called Intranets.
3.
Answer : (a)
Reason: The primary difference between program testing and system testing is system testing focuses on testing the interfaces between programs, whereas program testing focuses on individual programs
4.
Answer : (a)
Reason: The characteristic of a closed decision-making system is that the manager has a known set of decision options and knows their results when fully implemented.
5.
Answer : (b)
Reason: The methods of validating PINs that will result in the fewest control problems are : to allow a reasonable number of PIN entry attempts, close the account after the limit has been reached, but do not retain the card.
6.
Answer : (b)
Reason: following is not an assumption about the role of computers in decision making : Computers are the key constituents of an effective decision support system.
7.
Answer : (a)
Reason: Businesses like airline, banks and online services are adversely affected by natural calamities. Such organizations therefore, develop Disaster recovery mechanisms.
8.
Answer : (C)
Reason: Executive Information systems caters to the strategic information needs of the top management.
9.
Answer : (d)
Reason: The following is not likely a support provided by a Decision Support System : get major market share for the company’s products.
10.
Answer : (c)
Reason: The following is true regarding the development of EIS information requirements: determine the various formats in which reporting is done and the frequency of reporting.
11.
Answer : (c)
Reason: The following is not likely an advantage of the End-User-developed DSS : improved profit for the organization
12.
Answer : (d)
Reason: The following is central to successful MIS implementation : train the end-users of the system.
13.
Answer : (a)
Reason: The following is not a parameter in the Framework that evaluates the success of a DSS implementation : industry growth.
14.
Answer : (c)
Reason: In order to effectively control and maintain an MIS, the management must conduct periodic tests.
15.
Answer : (d)
Reason: In DSS, many type of tools help in building complex, systems. Some of complex system tools are Knowledge Acquisition, Knowledge Validation and Knowledge Verification.
16.
Answer : (b)
Reason: Business Process Re-engineering (BPR) is the “fundamental rethinking and radical design of business processes to achieve dramatic improvements in critical and contemporary measures of performance.”
17.
Answer : (A) Reason: Reporting system is used to monitor the progress of an MIS implementation.
18.
Answer : (a)
Reason: The following is not true about ERP : there will not be any resistance towards the new system (ERP) by senior employees of the organization.
19.
Answer : (a)
Reason: Compared with a manual system, the assets and records in a computer based information system tend to be : more concentrated at a single location.
20.
Answer : (c)
Reason: Information technology helps in evolving new types of organizations called Virtual organizations.
21.
Answer : (c)
Reason: Marketing and Advertising campaign is not a reason for things going wrong in the development and successful implementation of an MIS.
22.
Answer : (a)
Reason: Encryption provides data protection over the internet, intranet and extranet.
23.
Answer : (b)
Reason: The following is not a limitation of a Decision Support System : extend the decision maker’s ability to tackle large scale, time-consuming, complex problem.
24.
Answer : (c)
Reason: The most significant reason for an MIS to fail is lack of managerial participation.
25.
Answer : (c)
Reason: The use of digital technologies to enable multiple organizations to collaboratively design, develop, build, move and manage products through their life cycles is called collaborative commerce.
26.
Answer : (d)
Reason: Data must still be analyzed and interpreted by managers even with the best Management Information System in place.
27.
Answer : (e)
Reason: The theory of decision making which states that “an individual identifies goal, ranks all possible alternative actions by their contribution to these goals, and chooses the alternative that contributed most to those goals” is ‘Rational’ model.
28.
Answer : (a)
Reason: If a decision is based on a rule or a method it is called a Programmed decision.
29.
Answer : (d)
Reason: Currency represented in electronic form that moves outside the normal network of money is digital cash.
30.
Answer : (c)
Reason: An MIS implementation may not result in Unanimous acceptance by employees.