Question Paper

Management Information Systems (MC261) : April 2007

Section A : Basic Concepts (30 Marks)

 This section consists of questions with serial number 1 - 30.

 Answer all questions.
 Each question carries one mark.
 Maximum time for answering Section A is 30 Minutes.

1.
Information Technology (IT) infrastructure comprises of
(a)
Computer Hardware
(b)
Computer Software
(c)
Data & Storage Technology
(d)
Networks
(e)
All of the above.

2.
Systems that convert paper documents and images into digital form so that they can be stored and accessed
by the computer is
(a)
Personnel Information System
(b)
Management Information System
(c)
Document Imaging System
(d)
Executive Information System
(e)
Decision Support System.

3.
The return of items from buyers to sellers in a supply chain is
(a)
Inventory
(b)
Forward Logistics
(c)
Supply Chain
(d)
Customer Relationship
(e)
Reverse Logistics.

4.
Activity in which a firm excels as a world class leader is
(a)
Focused differentiation
(b)
Core competency
(c)
Value chain
(d)
Product differentiation
(e)
Value Web.

5.
Situation, where the relative bargaining power of two parties in a transaction, is determined by one party in
the transaction possessing more information essential to the transaction, than the other
(a)
Information asymmetry
(b)
Information partnership
(c)
Standard operating procedures
(d)
Information symmetry
(e)
Organizational cultures.

6.
The removal of organization or business process layers responsible for certain intermediary steps in a value
chain is
(a)
Reintermediation
(b)
Pure play
(c)
Syndicator
(d)
Click-and-morter
(e)
Disintermediation.
7.
Tiny file deposited on a computer hard drive when an individual visits certain websites, and used to identify
the visitor and track visits to the website
(a)
Profiling
(b)
Cookie
(c)
Smart card
(d)
Ethics
(e)
Pure-play.

8.
A legal document that grants the owner an exclusive monopoly on the ideas behind an invention for about
20 years is
(a)
Intellectual property
(b)
Trade secret
(c)
Copy right
(d)
Patent
(e)
Framing.

9.
Applying the computational resources of many computers in the network to a single large and complex
problem is
(a)
Peer-to-peer computing
(b)
Client – server computing
(c)
Parallel computing
(d)
Utility computing
(e)
Grid computing.

10.
Collection of documented internal and external knowledge in a single location for more efficient
management and utilization by an organization.
(a)
Community of Practice
(b)
Team ware
(c)
Vertical Reality Systems
(d)
Knowledge Repository
(e)
Artificial Intelligence.

11.
The system that records all business transactions and other economic events and is based on the double
entry bookkeeping concept is known as
(a)
Operational control system
(b)
Workflow system
(c)
Personnel information system
(d)
Accounting information system
(e)
Marketing information system.

12.
The assurance that systems will be available when required and perform at acceptable levels of quality is
termed as
(a)
Integrity
(b)
Reliability
(c)
Privacy
(d)
Authenticity
(e)
Authority.

13.
Prototyping is defined as
(a)
An interactive and iterative process of developing and refining information system prototypes
(b)
Is a multi-step process to conceive, design and implement an information system
(c)
A detailed description of hardware and software
(d)
Studying in detail the information needs of users
(e)
Photographing an existing information system.

14.
Which of the following is not a function of the Presentation Language component of a Decision Support
System?
(a)
Allows for interaction with the DSS in a variety of dialog styles
(b)
Provides for the presentation of data in a variety of formats
(c)
Allows for detailed report definition and generation by the DSS user
(d)
Allows for the creation of forms, tables, and graphics for data output
(e)
Can provide for multiple “windows,” or views, of the data to be available simultaneously.

15.
Which of the following is not a force acting upon a typical decision maker?
(a)
Personal & Emotional Forces
(b)
Economic / Environmental Forces
(c)
Organizational Forces
(d)
Gravitational Forces
(e)
Contextual and Emergent Forces.

16.
The degree to which decision task is unclear to a decision maker is
(a)
Complexity
(b)
Accountability
(c)
Ability
(d)
Reversibility
(e)
Ambiguity.

17.
A computer based application that employs a set of rules based upon human knowledge to solve problems
that require human expertise is
(a)
Management Information System
(b)
Operations Management System
(c)
Expert System
(d)
Decision Support System
(e)
Marketing Information System.

18.
The detailed study of the information needs of users and any information system presently used is called
(a)
Prototyping
(b)
System analysis
(c)
Systems design
(d)
Systems approach
(e)
System Testing.

19.
A management information system
(a)
Is the last stage of the systems development cycle
(b)
Collects, organizes, and disseminates business know-how within a company
(c)
Provide information for managers in a variety of structured formats
(d)
Makes improvements to an operational system
(e)
Provides information on how to manage the company.

20.
A huge repository of preprocessed operational data is
(a)
Data
(b)
Database
(c)
Datamart
(d)
Information
(e)
Data Warehouse.

21.
Which of the following is not an advantage of end user developed Decision Support System (DSS)?
(a)
The system delivery time is short
(b)
The prerequisites of extensive and formal user requirements specifications are eliminated
(c)
Lack of DSS design knowledge and controls, can result in poor quality
(d)
Some DSS implementation problem are reduced
(e)
The development cost is usually low.

22.
Even when two individuals take a similar decision, their decision making style need not be the same. The
manner in which individuals organize and manipulates data is known as
(a)
Life style
(b)
Cognitive style
(c)
Hyper style
(d)
Hypo style
(e)
Hair style.

23.
Sales Force automation will come under
(a)
Finance & Accounting System
(b)
Marketing Information System
(c)
Manufacturing Information System
(d)
Human Resource Information System
(e)
Production Planning & Control System.

24.
Computers in manufacturing concerns are largely used for
(a)
Market intelligence
(b)
Advertising
(c)
Pay roll
(d)
Production and Inventory Control
(e)
Public Relations.

25.
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.

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.
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.
28.
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.

29.
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.

30.
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.

END OF SECTION A

Section B : Problems/Caselets (50 Marks)

 This section consists of questions with serial number 1 – 6.
  Answer all questions.
 Marks are indicated against each question.
 Detailed workings/explanations should form part of your
answer.
 Do not spend more than 110 - 120 minutes on Section B.

1.
Ram the Chief Information Officer at Databliss Corp wants to install an MIS in the Organization. However,
he is not able to decide on the essential features that an MIS needs to have. What would be Ram’s criteria
for selecting the MIS? What other aspects of designing and implementing an effective MIS does he need to
take care of?
(12 marks)

2.
“Decision Support Systems stress more on “Support” rather than automation of decisions” Discuss the
relevance of this statement.
(12 marks)

Caselet 1
Read the caselet carefully and answer the following questions:
3.
Why is Trinity splitting its top information systems job into two positions?
(7 marks)

4.
Should other companies appoint CIO and CTO executives to manage their use of information technology?
What are the limitations and benefits of this approach?
(6 marks)

Most Chief Information Officers (CIOs) dream of creating innovative business applications so that their
company gains a competitive advantage. However, they end up spending most of their time dealing with
legacy systems maintenance. At Trinity Corporation, management decided that one executive simply
couldn’t shoulder the burden of IT strategy and infrastructure as the company sought to explore new growth
opportunities. Hence, Trinity split the top technologist position into the position of CIO and the position of
Chief Technology Officer (CTO). Companies such as Merrill Lynch & Co., General Motors, and GE
Capital Corporation have had CIOs setting and aligning business goals and strategies. But chief technology
officers (CTOs) typically handled day-to-day operations.
Trinity Corp., split the duties of the CIOs because the time and resource constraints that weighed on them
were just too much. Now Trinity is in a position to leverage new business opportunities. It can make
effective use of the terabytes of data it has on 25 million households and also try to expand the company’s
catalog customers.
Trinity Corp. is in the early stages of bolstering Trinity Online with more products and services for sale.
According to analysts, the company is also considered to be a technology leader because of its innovative
use of database marketing and data mining capabilities.
 Caselet 2
Read the caselet carefully and answer the following questions:
5.
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 computer.
(6 marks)

6.
i. What process could IEL use to include the daily order data within EIL’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 representative 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 representative’s information may not be current,
stockouts are infrequent.
Every evening, after all the sales representatives 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 representative logs on again in the morning and downloads a copy of the updated MIS.

END OF SECTION B

Section C : Applied Theory (20 Marks)

 This section consists of questions with serial number 7 - 8.
 Answer all questions.
 Marks are indicated against each question.
 Do not spend more than 25 -30 minutes on section C.

7.
The Managing Director of Synopsis Ltd., asked his Manager “What can go wrong in developing are MIS?”
The Manager compiled a report and submitted to the MD. What could be the content of the report?
(10 marks)
8.
Why is a Decision Support System (DSS) a powerful tool for decision makers?
(10 marks)

END OF SECTION C

END OF QUESTION PAPER

1.
Answer : (e)
Reason: Computer Hardware; Software; Data & Storage Technology and Networks – all Forms IT
Infrastructure

2.
Answer : (c)
Reason: Systems that convert paper documents and images into digital form so that they can be stored
and accessed by the computer is Document Imaging System

3.
Answer : (e)
Reason: The return of items from buyers to sellers in a supply chain is Reverse Logistics

4.
Answer : (b)
Reason: Activity in which a firm excels as a word class leader is Core competency

5.
Answer : (a)
Reason: Situation, where the relative bargaining power of two parties in a transaction, is determined by
one party in the transaction possessing more information essential to the transaction, than the
other is known as Information asymmetry

6.
Answer : (e)
Reason: The removal of organization or business process layers responsible for certain intermediary steps
in a value chain is disintermediation

7.
Answer : (b)
Reason: Tiny file deposited on a computer hard drive when an individual visits certain websites, and used
to identify the visitor and track visits to the website is cookie
8.
Answer : (d)
Reason: A legal document that grants the owner an exclusive monopoly on the ideas behind an invention
for about 20 years is Patent

9.
Answer : (e)
Reason: Applying the computational resources of many computers in the network to a single large and
complex problem is grid computing.

10.
Answer : (d)
Reason: Collection of documented internal and external knowledge in a single location for more efficient
management and utilization by an organization is Knowledge Repository.

11.
Answer : (d)
Reason: The system that records all business transactions and other economic events and is based on the
double entry bookkeeping concept is known as Accounting information system

12.
Answer : (b)
Reason: The assurance that systems will be available when required and perform at acceptable levels of
quality is termed as Reliability

13.
Answer : (a)
Reason: Prototyping is defined as an interactive and iterative process of developing and refining
information system prototypes

14.
Answer : (a)
Reason: Allowing interaction with the DSS in a variety of dialog styles is not a function of the
Presentation Language component of a Decision Support System

15.
Answer : (d)
Reason: Gravitational Force is not a force acting upon a typical decision maker

16.
Answer : (e)
Reason: The degree to which decision task is unclear to a decision maker is Ambiguity
17.
Answer : (c)
Reason: A computer based application that employs a set of rules based upon human knowledge to solve
problems that require human expertise is Expert System

18.
Answer : (b)
Reason: The detailed study of the information needs of users and any information system presently used
is called System analysis

19.
Answer : (c)
Reason: A management information system provides information for managers in a variety of structured
formats

20.
Answer : (e)
Reason: A huge repository of preprocessed operational data is Data Warehouse

21.
Answer : (c)
Reason: Lack of DSS design knowledge and controls, can result in poor quality. is not an advantage of
end user developed Decision Support System (DSS)

22.
Answer : (b)
Reason: Even when two individuals take a similar decision, their decision making style need not be the
same. The manner in which individuals organize and manipulates data is known as Cognitive
style

23.
Answer : (b)
Reason: Sales Force automation will come under Marketing Information System

24.
Answer : (d)
Reason: Computers in manufacturing concerns are largely used for Production and Inventory Control

25.
Answer : (c)
Reason: Executive information systems caters to the strategic information needs of the top management

26.
Answer : (d)
Reason: Even with the best Management Information System in place, Data must still be analyzed and
interpreted by managers

27.
Answer : (d)
Reason: Training the end-users of the system is central to successful MIS implementation

28.
Answer : (c)
Reason: In order to effectively control and maintain an MIS, the management must conduct periodic tests

29.
Answer : (c)
Reason: The most significant reason for an MIS to fail is Lack of managerial participation

30.
Answer : (a)
Reason: If a decision is based on a rule or a method it is called a Programmed decision

Section B : Problems/Caselets
1
Ram needs to make sure that the MIS is effective and can help Databliss Corp function smoothly. An
effective MIS has the following features:
 Ability to provide surprise information that will reduce uncertainty.
 Building a knowledge base.
 Reduction of errors by using high level validation techniques.
 Communication theory of transmitting information should be given due importance in system’s
design.
 Noise and other disturbances should be minimized through proper presentation.
 It should be designed in such a way that information cannot be misused.
Apart from ensuring the above mentioned features, Ram should ascertain that distinction should be made
between different types of information requirements and importance should be given to the human facet of
information while designing a MIS system. MIS should be used mainly in planning, performance control
and building knowledge database. Managers have individual differences that arise because of perception of
management control, faith in information versus knowledge, risk propensity, tolerance for ambiguity and
manipulative intelligence. MIS should be developed to cater to the entire organization taking into
consideration the different information needs at different organizational levels. It is not possible to develop
a standardized MIS package for all organizations. Though some amount of standardization is required there
should be enough space for customization. MIS should take into consideration the purpose of application
and the organizational structure, culture, attitude, beliefs, and strengths and weaknesses of the organization

2
Decision support systems (DSS) are a class of systems which support the decision-making process. The
DSS enables data retrieval for the decision maker. The decision maker then tests the alternative solutions
with the available data. Thus, DSS provides support to decisions. There are several assumptions about the
role of computers in decision-making. The concept of decision-making is based on the following
assumptions:
 The role of computers must be such that they should not replace a manager’s judgment. They should
only be instrumental in supporting a manager with his judgment. Thus, the DSS should not attempt to
provide any ‘answers’ or any pre-defined solutions but only help the manager with sufficient details to
move towards the solution.
 Computers may help to the extent of structuring the problems and helping with a systematized
approach towards the solution, But, to control the process. the decision-makers insight and judgment
are indispensable.
 The key to effective problem-solving is having an interactive and enhanced dialogue between the user
and the system. The user deals with the problem by utilizing .the information which the system
provides. Added to this, he applies his experience and insights to effectively deal with the problem.
The decision support system should be such that the user should be in a position to easily access the
database containing the necessary data. Also, it must support an interactive testing of solutions, so that the
manager can arrive at an optimal solution to the problem. However, to design such a system, the designer
must be well acquainted with the decision- making process and the various situations that might be
encountered.

3
The management at Trinity Corporation decided to split the company’s top information systems job into
two because it felt that one executive could not handle the burden of IT strategy and infrastructure. Also,
since the company wanted to explore new growth opportunities, it felt that it would be difficult for one
executive to handle the workload efficiently. Typically, chief information officers (CIOs) set and align
business goals and strategies. However, chief technology officers (CTOs) handle the day-to-day operations.

4
Depending on the size of the company and its future expansion. plans, it should decide whether it requires
ClO and CTO executives to manage its use of information technology. If a company aspires to expand and
increase its operations, it must split its top information systems job into two positions. This will ensure that
the company operates smoothly. However, if the company plans to cut costs and does not intend to expand,
this move would not be advisable as would create more designations and increase costs.

5
i. Given the fact that the sales reps would be telephoning from some remote place, some sort of check
must be in place to verify whether the telephone calls are being received from authorized staff.
To begin with, password control can be used such that the central computer does not allow any
logging-on unless the sales rep enters the right password. For greater security, IEL can introduce a
call-back facility. The main computer can telephone the remote computer on a previously agreed
number, after it receives the initial call. The company’s data files can be accessed only if the computer
is attached to the telephone line.
ii. After establishing contact with the central computer, data transfer must be checked for completeness
and accuracy. Data completeness can be ensured to an extent by using dedicated landlines. This will
eliminate ‘noise’ from other network lines and provide for additional security. Data encryption would
assist the security of transfer and also assist in checking the accuracy of transfer. Encrypted data
cannot be read unless an appropriate key is available for translating the message.

6
i. In order to include the daily order data in IEL’s MIS, the following process could be adopted:
  Data Input: Checks can be made to ensure that data was received from all sales reps before the
main database was updated.
 Data collation and summarization: Data could be summarized and normalized before being
entered into the database.
 Data updation: The normalized data could then be used to update the database.
ii. MIS outputs can be in various forms, depending on the utility required from the information.
Typically, the outputs include:
 Summaries of orders and stock balances – both daily and cumulatively for each product line.
Decision-makers can arrive at the overall quantity of goods required from this information.
 Special reports showing products with unusually large or small orders or old stock balances. This
information could be of particular use when advertising ‘special offers’ or negotiating discounts
with suppliers when large quantities are ordered.
 Reports showing trends on a monthly or yearly basis. Decision-makers can plan their production
schedulers to meet the future demand based on this.
Graphical output could be of particular interest to the senior management because of its ease in data
representation. Such reports can also be generated for the senior management at IEL’s.

Section C: Applied Theory

7
The manager should cover all aspects that can go wrong in developing an MIS:
 Absence of a management system
 Absence of clear definition of mission and purpose.
 Lack of objectives for the company.
 No management participation.
 Disorganization.
 Over dependence on the consultant manufacturer
 The communication gap
 Performance of key personnel.
All these shortcomings are general weakness in the organization as a whole. They can come up anywhere in
the organization. Since MIS development projects are complex, these problems generally show up quickly.
It must be remembered that information systems are not a solution to any of these problems; they are just
the medium through which the problems become noticeable to the organization. However, these
shortcomings in the organizations infrastructure must be set right to make the MIS a success

8
The DSS clearly offers management a powerful tool and is rapidly becoming an integral component of
managerial work. The speed with which today’s information becomes yesterday’s news continues to
increase at a staggering rate. Tomorrow’s manager will confront an ever-narrowing window of opportunity
within which effective decisions will need to be made. Deadlines will be measured in days, hours, and
minutes rather than in quarters, months, and years. The leveraging of technology that will allow tomorrow’s
manager to be effective in such a high-speed environment is what decision support is all about. To meet the
demands of managerial work, a DSS must be able to provide the decision maker with certain key elements
vital to his or her success. A DSS cannot offer benefits in all decision situations or by all decision makers,
the context of the decision, and the DSS itself. Assuming the fit is there, however, we can, in general,
expect several potential benefits from using a DSS. In addition, we must acknowledge and understand the
limitations of using a DSS.
sAs you can see, the DSS is expected to extend the decision maker’s capacity in processing the mountain of
information involved in making a decision. Further, many components of a decision situation, although
structured, are nonetheless highly complex and time-consuming. The DSS can solve those portions of the
problem, and save on cognitive resources and, more importantly, large blocks of precious time for the
decision maker. As a result, using a DSS can be expected to decrease the overall time involved in reaching
a complex, unstructured decision.
Additional benefits can be found in the areas of innovation and creativity. Simply using the DSS can
provide the decision maker with potential alternatives that might otherwise go unnoticed or appear too
complex and difficult to pursue. The tools within the DSS can stimulate the problem solver to reach
innovative insights regarding solutions and their associated outcomes. In addition, the output of the DSS
may often justify the position of the decision maker(s), thus facilitating consensus among stakeholders.
Finally, given the shrinking window of opportunity associated with the pace of business, the DSS may
provide competitive advantage to organization.