Business Information System

01.
(a) What is MIS? (May – 04, May F -
96)
Answer:
Management Information System (MIS) can be defined as a network of
computer-based data processing procedures developed in an organization and integrated as
necessary with manual and other procedures for the purpose of providing timely and
effective information to support decision making and other necessary management
functions.

(b) Only a computerized MIS can cope with the dynamic of changing
management requirements” – explain. (May – 04, May
F - 96)
Answer:
The concept sounds simple and it might seem that an MIS can be introduced even without a
computer. Theoretically it may seem so, but practically it would almost be impossible to do
so. At a rudimentary form MIS might be possible without using computers.
Computerized MIS –
i) Focus on providing managers with pre-specified information products that report on
the performance of the organization.
ii) Designed to indirectly support the more structured types of decisions involved in
operational and tactical planning and control.
Thus, the levels of managerial decision making that must be supported by information
technology in a successful organization.

(c) What is information? (May F –

97, May F - 00)

Answer:
When we process data and convert it into a form that is useful and meaningful to decision
maker, it becomes information. So, information is a loaded word, in relation to a particular
decision. Computer storage may contain huge files of data, but those are not information
until needed for some decision making process.

(d) Discuss how, within an MIS structure, information for one

layer of management become data for another. (May F –
97, May F - 00)

Answer:
The management may be divided into three layers:
i) The top level or strategic management
ii) The mid level or tactical management
iii) The low level or operational management
The lowest management levels deals with detailed transaction data and its first level
summarization. The middle management uses next level summarized information and trends

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 for its decision making. The top level management makes its decision on the basis of overall
summary information, trends, ratios, comparisons, variances etc.
Information is completely detailed at the lowest level of management and completely
summarized at the top level. In between, information gets increasingly summarized as it
goes upward.

(e) Write an essay on the design and implementation of MIS in an

organization. Or, (May F – 95)
What points require attention when designing a computer-based
MIS for an organization? (May F – 96, Nov – 05, Nov
F – 98)

Answer:
Management Information System (MIS) can be defined as a network of
computer-based data processing procedures developed in an organization and integrated as
necessary with manual and other procedures for the purpose of providing timely and
effective information to support decision making and other necessary management
functions.
The following points require particular attention when designing
an MIS:
1. Education:
Preliminary education of management in MIS and data processing concepts is
essential.
2. Definition of information required:
The manager must define his information needs. The manager needs to know:
i) What are his resources?
ii) At what rate are those resources being used?
iii) How well is he using these resources?
3. Quantity of information:
A computer-based information system may provide too much of information which
may not actually be needed. A manager must get the right quantity of information at
the right time.
4. Flexibility:
Computer-based information systems tend to be inflexible. It provides information
just as designed and programmed. The computer-based information system should,
however, accommodate as much flexibility as possible during design stage.
5. Testing:
The system must be thoroughly tested by both computer staff and managers to make
it fully acceptable.

(f) What is an integrated system? (Nov – 05, Nov

F – 98)
Answer:
An integrated information for the whole organization requires that a single
computer-based MIS be designed for the whole system so that the effects of a decision made

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 in one section of the organization would immediately be determined by the MIS for all other
parts of the organization.

02.
(a) What is an ERP? Discuss its advantages and Disadvantages. (Nov
– 05)
Answer:
Enterprise resource planning (ERP) is a cross-functional enterprise system that
serves as a framework to integrate and automate many of the business processes that must be
accomplished within the manufacturing, logistics, distribution, accounting, finance, human
resource functions of a business.
Advantages:
1. Quality and efficiency
ERP creates a framework for integrating and improving a company’s internal
business process that results in significant improvements in the quality and efficiency
of customer service, production and distribution.
2. Decreased Costs
Many companies report significant reductions in transaction processing costs and
hardware, software, and IT support staff by their new ERP systems.
3. Decision Support
ERP provides cross-functional information on business performance to assist
managers in making better decisions in a timely manner.
Disadvantages:
1. To set up the ERP system is cost consuming.
2. Special knowledge based ERP expert is necessary to run and maintain the ERP
system.

(b) What is DSS? What is the Component of DSS? What are the
features of DSS? (Nov –
04, May F – 00)

Answer:
Decision Support Systems (DSS) is a set of well-integrated, user-friendly
computer-based tools that combine data with various decision-making models to solve semi-
structured and unstructured problems.

Structure and Components of DSS:

1. Data management subsystem
2. Model management subsystem

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 3. User interface
4. Users
5. Knowledge- based subsystems
Features of DSS:
1. Facilitates semi-structured and un-structured decision making by bringing together
data, models and human judgment.
2. Supports several interdependent and sequential decisions.
3. Help to rapidly obtain quantitative results needed to reach a decision.
4. Helps the decision-maker for ad hoc-question.
5. Foster high-quality decision making
6. Facilitate the implementation of decisions
7. Support group decision making
8. Give managers the opportunity to gain a better understanding of their business.
(c) Briefly describe how a DSS may differ from an MIS. (Nov – 03)
Answer:
Difference between DSS and MIS:
DSS MIS
1. Problem Handles unstructured problems Used with more structured
type that cannot be easily problems.
programmed.
2. Users Supports individuals, small Supports the organization.
groups, and entire organization.
3. Support Supports decisions made by Can make decisions and replace
people. decision maker.
4. Approach Direct support system that Indirect support system that uses
provides interactive reports on regularly produced reports.
computer screens.
5. System Usually provides immediate May not provide immediate
results. results.
6. Speed Takes less time to develop; able Not as flexible.
to respond to user requests.
7. Output Usually screen oriented with Typically oriented toward
ability to generate reports on a printed reports and documents.
printer.

(d) Distinguish between the terms management information system,

decision support system and expert system. Illustrate your answer
with examples of situations where one may be preferable to the other.
(May – 02)
Answer:
Management Information System (MIS) can be defined as a network of
computer-based data processing procedures developed in an organization and integrated as
necessary with manual and other procedures for the purpose of providing timely and
effective information to support decision making and other necessary management
functions.

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 Decision Support Systems (DSS) is a set of well-integrated, user-friendly
computer-based tools that combine data with various decision-making models to solve semi-
structured and unstructured problems.
Expert System is a computer-based information system that uses its knowledge about a
specific complex application area to act as an expert consultant to users. Expert Systems
provide answers to questions in a very specific problem area by making humanlike
inferences about knowledge contained in a specialized knowledge base.
Of the three systems MIS has the widest application as it provides generalized
information, mostly in the form of reports categorized by function and frequency. Some
reports may be generated every day and some when a situation arises calling for specific
action. But a DSS is not a completely automated system as it works in an interactive mode
where the user may want to experiment with different options for solving a problem as in
production planning. An Expert System performs specific tasks with the help of a
knowledge base, which emulates the knowledge of an expert.

03.
(a) What is a system? (Nov F-
99)
Answer:
The systems approach to problem solving uses a systems orientation to define
problems and opportunities and develop solutions. Studying a problem and formulating a
solution involves the following interrelated activities:
1. Recognize and define a problem or opportunity using systems thinking.
2. Develop and evaluate alternative system solutions.
3. Select the system solution that best meets your requirements.
4. Design the selected system solution.
5. Implement and evaluate the success of the designed system.

(b) What is feasibility study? Discuss the steps and goal of

feasibility study. Discuss the categories of evaluation of the
feasibility of a system.
(Nov F-99)
Answer:
A feasibility study is preliminary studies which investigates the information needs of
prospective users and determine the resource requirements, cost, benefits, and feasibility of a
proposed project.
Steps of a feasibility study:
1. Gather information/data for a feasibility study.
2. Formalize a written report including the preliminary specifications and a
developmental plan for the proposed system.
3. Submit the report to management for approval.
4. Begin system analysis.
The goal of feasibility studies is to:
1. Evaluate alternative systems
2. Propose the most feasible and desirable systems for development.

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 Feasibility of a system can be evaluated in terms of four major
categories:
1. Organizational Feasibility
Organizational Feasibility focuses on how well a proposed information system
supports the objectives of the organization and its strategic plan for information
systems.
2. Economic Feasibility
Economic Feasibility focuses on whether the tangible costs and benefits of the
proposed system will exceed the costs of developing and operating it.
3. Technical Feasibility
Technical Feasibility focuses on the reliable or capabilities of the hardware and
software to meet the needs of the proposed system, and whether they can be acquired
or developed in the required time.
4. Operation Feasibility
Operation Feasibility focuses on the willingness and ability of the management,
employees, customers, suppliers, and others to operate, use, and support the
proposed system.

(c) Why is a systems study necessary before undertaking a project

for computerization of a currently manual system?
(May – 01)
Answer:
A feasibility study is a preliminary study which investigates the information needs of
prospective users and determines the resource requirements, cost, benefits, and feasibility of
a proposed project.
A feasibility study has four main objectives:
a) To determine whether the assignment is realistic, given the constraints of time and
money.
b) To determine the principal work areas, leading to the full systems investigation.
c) To identify areas where there is scope for saving money, time or effort-whether or
not these are in the original assignment brief.
d) To decide what methods of data processing should be employed, manual,
mechanical, microprocessors or a full main frame computer.

(d) What do you mean by system documentation? Discuss its use

and importance. (Nov
F – 94)
Answer:
Documentation of a system involves detailed and systematic recording of all work
done in finalizing the system design in all its stages. The purpose of the documentation is to
create a permanent directory and operational manuals for the system. The documentation
should include the following distinct aspects:

a. System Design Manual b. Data Flow Diagrams

c. Data Files and Data Dictionary
d. System flow-chart and Program Flow-charts
e. System Operations Manual f. User Manual

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 g. Maintenance Manual
A good documentation of the system helps in:
1. Understanding system, 2. Properly operating the system,
3. Debugging the system when needed 4. Redesigning the system
5. Extending the system 6. Maintaining the system
7. Reviewing the system
8. Creating a communication device for the systems people
9. Training users and operators etc.

(e) Bring out the reasons as to why the organizations fall to achieve
their system development objectives.
(May – 05)
Answer:
Information system development of an organization is a vital thing. The success of the
system helps management in decision making. The reasons as to why the organizations fail
to achieve their system development objectives are:
i) Lack of proper documentation of their system goal and system operational activities;
ii) Lacking of expertise;
iii) Lacking of knowledge management;
iv) Poorly build infrastructure in terms of computer backbone and computer hardware.
v) Time to time monitoring.
vi) Up-gradation and modification of software is not made properly.
04.
(a) What do you understand by the life-cycle of a system? Describe
the various stages in the analysis and design of a system with details
on the stage of going live. (May – 02, May – 02,
May F– 97, May F – 98)
Answer:
Most computer-based information systems are conceived, designed, and implemented using
some form of systematic development process. When the systems approach is applied to the
development of information system solutions, a multi-step process or cycle emerges. This is
known as the systems development life cycle (SDLC).
Steps involved in the traditional information systems
development cycle:
1. Systems investigation 2. Systems analysis 3. Systems design
4. Systems implementation 5. Systems maintenance
1. Systems investigation:
This step involves consideration of proposals generated by an information systems
planning process. The investigation stage also includes the preliminary study of
proposed information system solutions to end user business problems.
There are three steps of the systems investigation stage.
These are:
i) Determine whether a business problem or opportunity exists.
ii) Conduct a feasibility study to determine whether a new or improved
information system is a feasible solution
iii) Develop a project management plan and obtain management approval.

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 2. System Analysis:
Systems analysis is an in-depth study of end user information needs which produces
functional requirements that are used as the basis for the design of a new information
system.
System analysis involves a detailed study of:
i) The information needs of the organization and the end users.
ii) The activities, resources, and products of any present information systems.
iii) The information systems capabilities required to meet the information needs
of end users.
3. Systems Design:
System design is the creation of a roadmap that shows system developers how to
convert system requirements into system features. Systems design consists of design
activities which produce systems specifications satisfying the functional
requirements developed in the systems analysis stage.
4. System Implementation:
Once a proposed information system has been designed, it must be implemented.
The systems implementation stage involves:
i) Hardware and software acquisition
ii) Software development
iii) Testing of programs and procedures
iv) Education and training of end users and specialists who will operate the new
system.
v) Converting from the use of the present system to the operation of a new or
improved system.
5. Systems Maintenance:
Systems maintenance involves the monitoring, evaluating, and modifying of a
system to make desirable or necessary improvements.
This may include:
1. Post implementation review process to ensure that the new system meets the
objectives established for it.
2. Later modifications to a system may also become necessary due to changes
within the business or the business environment.

(b) Why is system analysis and design important for any computer-
based information system? Discuss in brief. (May F –
95, May F – 94)
Answer:
Systems analysis is an in-depth study of end user information needs which produces
functional requirements that are used as the basis for the design of a new information
system. So, System analysis considered the most important stage in SLDC.

System design is the creation of a roadmap that shows system developers how to
convert system requirements into system features. System analysis describes what a system
should do to meet the information needs of users. System design specifies how the system
will accomplish this objective. System Design produces the detailed technical plan for the
new system. So, System design considered the most important stage in SLDC.

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(c) “Designing is considered the most important stage in SLDC.” –
Do you agree with this statement?
(May – 04)
Answer:
System design is the creation of a roadmap that shows system developers how to convert
system requirements into system features. System analysis describes what a system should
do to meet the information needs of users. System design specifies how the system will
accomplish this objective. System Design produces the detailed technical plan for the new
system. So, System design considered the most important stage in SLDC.

(d) In an SDLC what are the deliverables of the following

development stages:
(i) Feasibility study; (ii) Requirement analysis;
(iii) Physical design; (iv) Coding;
(v) Testing. (May – 05)
Answer:
i) Feasibility Study:
A feasibility study is a preliminary study which investigates the information needs of
prospective users and determines the resource requirements, cost, benefits, and
feasibility of a proposed project.
The goal of feasibility studies is to:
1. Evaluate alternative systems
2. Propose the most feasible and desirable systems for development.

ii) Requirements Analysis:

Systems analysis is an in-depth study of end user information needs which produces
functional requirements that are used as the basis for the design of a new information
system.
iii) Physical Design:
Physical design addresses the physical aspects of the system input and output
devices, hardware configuration for the network, memory and storage, physical
security, and so on.
iv) Coding:
Development stage contains the coding of the processes of the new system, if a
computer system has been specified.
v) Testing:
Testing involves thoroughly probing the system to ensure that its performance
matches system requirements and meets the expectations of end-users.

(e) Explain the different conversion strategies used for conversion

from a manual to a computerized system.
(May – 05)
Answer:

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 The initial operation of a new computer-based system can be a difficult task. This typically
requires a conversion process from the use of a present system to the operation of a new
improved application. Conversion methods can often the impact of introducing new
information technologies into an organization.
The four common conversion methods include:
1. Parallel Conversion:
This is the safest method. The old and new systems are operated simultaneously until
sufficient confidence is gained in the new system.
2. Phased Conversion:
The new system is introduced at incremental stages.
3. Pilot Conversion:
This method relies on introducing a part of the system into one carefully designed
organizational area, learning from this experience and than introducing the complete
system.
4. Direct Conversion:
This is the most risky method. At a certain point, the old system is completely
replaced by the new one.

(f) Who is a system analyst? What are a system analyst’s prime

responsibilities?
(May – 04)
Answer:
System Analyst is a common job in MIS. The analyst is responsible for designing new
systems. Analysts must understand the business application and be able to communicate
with users. Analysts must also understand technical specifications and programming details.

The prime responsibility of a system analyst is as follows:

1. Understanding the problem:
First, he should fully understand the existing users’ problems and weaknesses of
existing system.
2. Feasibility study:
Determines whether the system is feasible with in the socio-technical framework of
the organization.

3. Establishing functional requirement:

The next prime responsibility of a system analyst is establishing the functional
requirements of the system.

05.
(a) Describe the different Information System for Business
Operation.
Answer:
The term business information systems are used to describe a variety of types of
information systems that support the functions of business.
1. Cross Functional Information Systems:

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 Information systems can be grouped into business function categories; however, in
the real world information systems are typically integrated combinations of
functional information systems.
2. Marketing Information Systems:
Marketing information systems integrate the information flow required by many
marketing activities.
3. Manufacturing Information Systems:
Manufacturing information systems support the production or operations function,
which includes all activities concerned with the planning and control of the processes
that produce goods or services.
4. Human Resource Information Systems:
The human resource management (HRM) function involves the recruitment,
placement, evaluation, compensation, and development of the employees of an
organization.
5. Accounting Information Systems:
Computer based accounting information systems:
i) Record and report the flow of funds through an organization on a historical
basis and produce important financial statements such as balance sheets and
income statements.
ii) Produce forecasts of future conditions such as projected financial statements
and financial budgets.
6. Financial Information Systems:
Computer-based financial information systems support financial managers in
decisions concerning:
i) The financing of a business.
ii) The allocation and control of financial resources within a business.
(b) What is Artificial Intelligence? Why is it of interest to business?
(Nov – 04)
Answer:
Artificial intelligence is the effort to develop computer-based systems that behave as
humans. The goal of AI is to create ‘intelligent machines” by modeling human intelligence
in computers.
Artificial intelligence is of great interest to business for the following reasons:
1. To store information in an active form as organization memory, creating an
organizational knowledge base that many employees can examine and preserving
expertise that might be lost when an acknowledged expert leaves the firm.
2. To eliminate routine and unsatisfying jobs held by people.
3. To enhance the organization’s knowledge base by generating solutions to specific
problems that are too massive and complex to be analyzed by human beings in a
short period of time.

(c) Describe an Expert System and explain how it can help

organization to use their knowledge assets.
(Nov – 04)
Answer:

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 Expert System is a computer-based information system that uses its knowledge about a
specific complex application area to act as an expert consultant to end users. Expert
Systems provide answers to questions in a very specific problem area by making humanlike
inferences about knowledge contained in a specialized knowledge base.
Some of the possible organizational benefits of expert systems
are:
1. Maintain control over the organization’s knowledge.
2. Expert systems help to preserve and reproduce the knowledge of experts. They allow
an organization to preserve the expertise of an expert before leaves the organization.
3. Effective use of expert systems can allow an organization to:
a. improve the efficiency of its operations.
b. produce new products and services.
c. lock in customers and suppliers with new business relationships.
d. build knowledge-based strategic information resources.

(e) Describe the design of a Management Information System with

special reference to the following:
(i) The differences among strategic, tactical and operational
level of planning;
(ii) The differences among structured, unstructured and semi-
structured decisions.
(Nov – 02)
Answer:
(i)
Strategic Planning deals with the development of an organization's mission, goals,
strategies, and policies.
Tactical Planning involves the design of tactics, the setting of objectives, and the
development of procedures, rules, schedules, and budgets.
Operational Planning which is done on a short-term basis to implement and control
day-to-day operations.
(ii)
Structured decisions are situations where the procedures to follow when a decision
is needed can be specified in advance.
Unstructured decisions are decision situations where it is not possible to specify in
advance most of the decision procedures to follow.
Semi-structured decisions are decision procedures can be pre-specified, but not
enough to lead to a definite recommended decision.

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