MIS

Module 1
 INTRODUCTION
• Management Information System, more commonly known
as MIS is a computer-based system.
• MIS actually helps the organization, especially the
managers, to organize and evaluate information and data,
and provide information in a timely and efficient manner.
• This also helps the managers make decisions based on the
information and analysis the MIS provides.
• As a business grows in size, the management of information
and the decisions based on such data get more complicated.
MIS helps organize such information, so decision making
becomes easier right from simple low-level decisions to
strategic plans made at the top level of management.
• Since it is a computer system, it includes elements of the
computer system as well.
• It has software (that help make the decisions), users
(managers), databases, all hardware necessary and
applications (people and project management applications)
as well.
• MIS analyzing problems and providing solutions.
• MIS scientifically
Collects
Stores
process and communicates information
This helps managers evaluate progress and delegate
work more efficiently, raising the overall efficiency
of the organization.
https://www.youtube.com/watch?v=c36M6oJS8sc
 History

• Earlier - companies using ledgers to keep track of

accounting
• the modern history of MIS can be divided into
five eras
• First Era – Mainframe and minicomputer
computing
• Second Era – Personal computers
• Third Era – Client/server networks
• Fourth Era – Enterprise computing
• Fifth Era – Cloud computing
• The first era (mainframe and minicomputer computing) was ruled by IBM,
requires both S/W and H/W, and occupies whole room.
• The second era (personal computers) began in 1965 as microprocessors
started to compete.
• The third era (client/server networks) arose as technological complexity
increased, costs decreased, and the end-user (now the ordinary employee)
required a system to share information with other employees within an
enterprise. Computers on a common network shared information on a
server.
• The fourth era (enterprise computing) enabled by high speed networks.
This new platform tied all aspects of the business enterprise together
offering rich information access encompassing the complete management
structure.
• Fifth era- cloud computing
• In the simplest terms, cloud computing means storing and accessing data
and programs over the internet instead of your computer's hard drive.
 Categories of Management Information Systems
• Management information system is a broad term that incorporates many specialized systems.
• Executive Information System (EIS)(or)Executive support system: Senior management
use to make decisions, it allows you to turn your organisation data into useful summarised
reports.
• Examples of reports:
• External databases.
• Technology reports like patent records etc.
• Technical reports from consultants.
• Market reports.
• Confidential information about competitors.
• Speculative information like market conditions.
• Government policies.
• Financial reports and information.

• Marketing Information System (MkIS): Marketing teams use MkIS to report on the
effectiveness of past and current campaigns and use to plan future campaigns. It includes all
facts, estimates, opinions and guideline, policies and other data. Information is collected
from internal and external. It is collected from customers, competitor, company salesman,
govt depts, agencies etc.

• Business Intelligence System (BIS): Lower level and executives will use BIS, to make
business decisions based on the collection, integration, and analysis of the collected data and
information.
• Customer Relationship Management System (CRM): A CRM system stores key
information about customers, including previous sales, contact information, and sales
opportunities. Marketing, customer service, sales, and business development teams often
use crm
• Knowledge Management System (KMS): Customer service can use
a KM system to answer questions and troubleshoot problems. (EG)
• Research and insights libraries.
• Customer service knowledge bases.
• Learning management systems.
• Online community forums.
• Human Resource Management System (HRMS): This system tracks
employee performance records and payroll data.
• Office automation systems (OAS) support communication and
productivity in the enterprise by automating workflow and eliminating
bottlenecks. OAS may be implemented at any and all levels of
management.
• School Information Management Systems (SIMS) cover school
administration, often including teaching and learning materials.
 Advantages of MIS
1. Generate Competitive Advantages:
• Business houses succeed or fail based on how they face competitive challenges.
• provides a wealth of information to allow management to construct and
develop effective plans to meet, and beat, their competition.

2. Implementation of Management by Objectives Techniques:

• both management and staff, to view, analyse and interpret useful data to set
goals and objectives.
3. Fast Reaction to Market Changes:
• facts, data and trends to business
• So, allows business houses to react quickly to market changes, regardless of the
type (positive or negative) or volatility.
4. Availability of Customer Data:
• Acts as a communication and planning tool.
• The availability of the customer data and feedback can help the business
houses.
• customer data can help the company to perform direct marketing and
promotion activities.
• Information about customer is important in this competitive world.
5.MIS reports allow for evaluation of the performance of employees,
machinery, and even money (investment). This allows the management to
make decisions about the future.
6. Helps in cost control by pointing out turnovers, idle times, wastage of
resources etc.
7. Compares budgets and plans to actual performances and figures. So, MIS
can pinpoint variances and help the management in taking appropriate actions
to correct the situation.
8. MIS also identifies the strengths of the organization, allowing the
management to take the opportunity to exploit it more
9. Takes away the uncertainty and risks involved with managerial decision
making.
10. MIS is the source for information regarding the company’s financial health
and current financial situation.
11. Companies are able to identify their strengths and weaknesses due to the
presence of revenue reports, employee performance records etc. Identifying
these aspects can help a company improve its business processes and
operations.
12. Giving an overall picture of the company
 Disadvantages of MIS
1. Expensive:
• Installation is expensive, especially for large org.
• upgrade fees, which can represent future fixed cash outflows.
• Companies must create a budget to pay for these items to ensure the
information system stays current with business technology.
2. Maintenance:
• hire maintenance individuals
• These individuals often need experience in computer science
• Increase labour cost and training exp.
3. Ineffective:
• Gathering unimportant or non-essential information can delay business.
• Business owners and managers may also need extensive training on new
systems.
4. Value:
• When incorrect data stays in a company's database, it can negatively affect
its full value.
• Outdated information, such as outdated past-due rental notices, or old
appraisals that have not been updated,
• This can negatively impact a business owner's.
• https://www.youtube.com/watch?v=qiLXJ0lhN2g (Fn of MIS)
• https://www.youtube.com/watch?v=UfO2dCIYWl8 (MIS)
 Importance of Information to decision making and strategy building

• Data : Data is the raw facts and figures or observations about a physical
phenomenon or business transactions. Data is also objective measurements
of the attributes of entities such as people, places, things and events.
• Information: Information is the data placed in a meaningful format and
useful context for an end user.
Information

Critical Crusial Pivitol

• For managers and organisation

• Hence MIS has emerged to facilitate effective
and efficient Decision making.
 ROLE OF MANAGEMENT INFORMATION SYSTEM

• The role of the MIS in an organization can be compared to the role of heart
in the body.
• The information is the blood and MIS is the heart.
• heart plays the role of supplying pure blood.
• The heart work faster and supplies more blood when needed.
• It regulates and controls the incoming impure blood, processed it and sends
it to the destination in the quantity needed. It fulfills the needs of blood
supply to human body in normal course and also in crisis.
• The MIS plays exactly the same role in the organization.
• The system ensures that an appropriate data is collected from the
various sources, processed and send further to all the needy
destinations. The system is expected to fulfill the information needs of
an individual, a group of individuals, the management functionaries:
the managers and top management.
• Here are some of the important roles of the MIS:
• i. The MIS satisfies the diverse needs through variety of systems such as query
system, analysis system, modelling system and decision support system.
• ii. The MIS helps in strategic planning, management control, operational control
and transaction processing. The MIS helps in the clerical personal in the transaction
processing and answers the queries on the data pertaining to the transaction, the
status of a particular record and reference on a variety of documents.
• iii. The MIS helps the junior management personnel by providing the operational
data for planning, scheduling and control , and helps them further in decision-
making at the operation level to correct an out of control situation.
• iv. The MIS helps the middle management in short term planning, target setting
and controlling the business functions. It is supported by the use of the management
tools of planning and control.
• v. The MIS helps the top-level management in goal setting, strategic planning and
evolving the business plans and their implementation.
• vi. The MIS plays the role of information generation, communication, problem
identification and helps in the process of decision-making. The MIS, therefore,
plays a vital role in the management, administration and operation of an
organization.
 MIS Functions
• The broad functions of MIS are as given below:
• To improve decision-making: MIS helps management by providing
background information on a variety of issues and helps to improve the
decision-making quality of management. The fast and accurate information
supplied by MIS is leveraged by the managers to take quicker and better
decisions thereby improving the decision-making quality and adding to the
bottom line of the company.
• To improve efficiency: MIS helps managers to conduct their tasks with
greater ease and with better efficiency. This reflects in better productivity
for the company.
• To provide connectivity: MIS provides managers with better connectivity
with the rest of the organization.
• Characteristics of MIS:
1. MIS is a consciously developed master plan for information flow. It is an ongoing
process. It operates continuously.

2. We have the best integration and coordination among functional departments,

executives and specialists such as systems analyst, programmer, and computer expert.

3. We have some kind of data processing equipment usually operated electronically. The
computer is the modern equipment for MIS.

4. MIS is future oriented. It anticipates and prevents problems as well as it solves

marketing problems. It is both a preventive as well as curative process in marketing.

5. The gathered data is processed with the help of management science or operations
research techniques. Modern mathematical and statistical tools are available for problem
solving in the field of marketing.

6. Systems analyst designs and operates MIS. It is operated through computers. Operations
research analyst offers solutions to the marketing problem with the help of quantitative
decision-making tools.

7. Management gets a steady flow of information on a regular basis the right information,
for the right people, at the right time and cost.
• Why is information system?
A sophisticated Information system stores the information in the database
which simplifies the process of finding the data easily. Business Information
System, eases the process of decision making and simplifies the process of
delivering the required information and hence assists in taking better decisions
instantly.
Reasons Why Information Systems Are Important for Business Today
• Any business can be successful only when there is a consistent
management of organizational and financial data with efficient
information systems.
• There is no alternative for the right information at the required time in the
world of business where every industry revolves round the "Internet of
Things"
• This raised the need to innovate and develop the systems that can be
implemented to make information accurate, that can be quickly accessed on
demand.
• An effective information system can entitle an organization with better
planning, decision-making and hence desired results.
• How does Modern Business influence Information Systems?
• Following are the benefits of information system
1. New Products and Services
• Any business striving to enhance and to give a strong hold on the future has
to instill a well organized Business Information System. An IS can help in
analyzing independent processes and enables organized work activities.
Hence an information system entitles the companies to understand how the
company generates, develops and sells the services or products.
2. Information Storage
• Keeping a log of activities is important for all the organizations, to
understand the reason for the problems and so to provide solution to the
same. Business Information System makes it simple to store operational
data, revision histories, communication records and documents. The storing
of data manually involves a lot of time and money. A sophisticated
Information system stores the information in the database which simplifies
the process of finding the data easily.
3. Simplified Decision Making
Business Information System, eases the process of decision making and simplifies the
process of delivering the required information and hence assists in taking better
decisions instantly.
4. Behavioral Change
Business Information System can be effectively implemented to help communication
better between the employers and the employees. Information Systems work better as it
stores documents and files in folders that can be accessed and shared by the employees.
This ensures to oversee the flow of information between the management and the
lower-level employees. This also allows the front-line employees to be a part of the
decision making process and hence feel motivated and committed towards doing a task.
 Subsystems of MIS
Following are the subsystems of Management Information System:
1. Transaction Processing System
2. Management Reporting System
3. Decision Support System
4. Office Information System
5. Business Expert System
1. Transaction Processing System - A transaction is defined as an exchange
between two or more business entities.
• Overall transaction processing, also known as data processing, reflects the
principal business activities of a firm like - sales, production, inventory,
shipping, receiving, billing, accounts payable, accounts receivables,
payroll, general ledger, etc. .
• Transactions are important events for an organization, and collecting data
about them is called transaction processing.
• Transaction Processing System's primary purpose is to record, process,
validate, and store transactions that take place in the various functional
areas of a business for future retrieval and use.
• A TPS records internal and external transactions for a company.
• A TPS performs routine and repetitive tasks. It is mostly used by lower
level managers to make operational decisions.
• Transactions can be recorded in batch mode or online. In batch mode files
are updated periodically; and in online mode, each transaction is recorded
as it occurs.
• TPS is a six-step process - Data entry, Data capture, Data validation,
Processing and re-validation, Storage, Output generation, and Query
support.
2. Management Reporting System - Management Reporting Systems are the
most elaborate of management-oriented MIS components.
• Its main objective is to provide lower and middle management with printed
reports and inquiry capabilities to help maintain operational and
management control of enterprise.
• MRSs are usually developed by information system professionals, rather
than by end users.
• MRSs are oriented towards reporting on the past and the present, rather than
projecting the future.
• MRSs largely report on internal company operations.
• MRSs generally have limited analytical capabilities.
• MRSs do not directly support the decision-making process.
• MRSs provide Scheduled or Periodic Reports, Exception Reports, and
Demand or Ad-hoc Report.
3. Decision Support System - Decision Support Systems are a class of
computerized information systems that support decision-making activities.
DSS are interactive computer-based systems and subsystems intended to help
decision makers. A DSS may present information graphically and may include
an expert system or artificial intelligence.
• DSSs support for decision-makers in semi-structured and unstructured problems.
• DSSs are more focused on specific decision rather than routine flows of information.
• DSS present information graphically and may include an expert system or artificial
intelligence.
• DSSs are adaptive over time.
4. Office Information System - Office Information System is an information system that
uses hardware, software, and networks to enhance work flow and better communication
between employees.
• Office automation refers to the application of computer and communication technology
to office functions.
• Office automation systems are the combination of hardware, software and people in
information systems, that process office transactions and support office activities at all
levels of the organization.
• These systems include a wide range of support facilities, which include word processing,
electronic filing, electronic mail, message switching, data storage, data and voice
communication etc.
• 5. Business Expert System - Business expert system is a
knowledge-based information system that uses its knowledge
about a specific, complex application area to act as an expert..
• Expert system provides decision support to managers in the form
of advice from an expert in a specific problem area. Expert
systems find application in diverse areas, ranging from medical,
engineering and business.
• https://study.com/academy/lesson/applications-of-management-
information-systems-mis-financial-marketing-manufacturing-
human-resources.html
• https://study.com/academy/lesson/subsystem-definition-lesson-
quiz.html
 What is a Decision Support System (DSS)?

• A decision support system (DSS) is an information system that aids a

business in decision-making activities that require judgment, determination,
and a sequence of actions.
• The information system assists the mid- and high-level management of an
organization by analyzing huge volumes of unstructured data and
accumulating information that can help to solve problems and help in
decision-making.
• A DSS is either human-powered, automated, or a combination of both.
• Types of Decision Support Systems
• Communication-driven: Allows companies to support tasks that require more
than one person to work on the task. It includes integrated tools such as
Microsoft SharePoint Workspace and Google Docs.
• Model-driven: Allows access to and the management of financial,
organizational, and statistical models. Data is collected, and parameters are
determined using the information provided by users. The information is created
into a decision-making model to analyze situations. An example of a model-
driven DSS is Dicodess – an open-source model-driven DSS.
• Knowledge-driven: Provides factual and specialized solutions to situations
using stored facts, procedures, rules, or interactive decision-making structures
like flowcharts.
• Document-driven: Manages unstructured information in different electronic
formats.
• Data-driven: Helps companies to store and analyze internal and external data.
Purpose of a Decision Support System
• A decision support system produces detailed information reports by
gathering and analyzing data.
• In an organization, a DSS is used by the planning departments – such as
the operations department – which collects data and creates a report that
can be used by managers for decision-making.
• Mainly, a DSS is used in sales projection, for inventory and operations-
related data, and to present information to customers in an easy-to-
understand manner.
• Theoretically, a DSS can be employed in various knowledge domains
from an organization to forest management and the medical field. One of
the main applications of a DSS in an organization is real-time reporting. It
can be very helpful for organizations that take part in just-in-time
(JIT) inventory management.
Components of a Decision Support System
• The three main components of a DSS framework are:

• 1. Model Management System

• The model management system stores models that managers can use in their decision-
making. The models are used in decision-making regarding the financial health of the
organization and forecasting demand for a good or service.

• 2. User Interface
• The user interface includes tools that help the end-user of a DSS to navigate through the
system.

• 3. Knowledge Base
• The knowledge base includes information from internal sources (information collected in
a transaction process system) and external sources (newspapers and online databases).
Advantages of a Decision Support System
• A decision support system increases the speed and efficiency of decision-
making activities. It is possible, as a DSS can collect and analyze real-time
data.
• It promotes training within the organization, as specific skills must be
developed to implement and run a DSS within an organization.
• It automates monotonous managerial processes, which means more of the
manager’s time can be spent on decision-making.
• It improves interpersonal communication within the organization.
• Disadvantages of a Decision Support System
• The cost to develop and implement a DSS is a huge capital
investment, which makes it less accessible to smaller organizations.
• A company can develop a dependence on a DSS, as it is integrated
into daily decision-making processes to improve efficiency and
speed. However, managers tend to rely on the system too much,
which takes away the subjectivity aspect of decision-making.
• A DSS may lead to information overload because an information
system tends to consider all aspects of a problem. It creates a
dilemma for end-users, as they are left with multiple choices.
• Implementation of a DSS can cause fear and backlash from lower-
level employees. Many of them are not comfortable with new
technology and are afraid of losing their jobs to technology.
https://www.youtube.com/watch?v=siMgr-PwXaI
• .
https://www.youtube.com/watch?v=Qujsd4vk
qFI (information sys)
• https://www.youtube.com/watch?v=RdgFoFP
Tckw
 Management Support System
• Management Support Systems (MSS) are computer-based systems that are
supposed to be used by, or at least to support, managers. A major problem
in MSS development is requirements specification.

Why is management support important?

• Managerial support can take many different forms, including effective
communication between workers and managers, involving workers in
important decisions, giving workers clear feedback on their performance
and helping them with difficult tasks
• Providing information and support for effective decision making by all
types of managers and business professionals will be supported and
assisted by Management Support Systems. MSS are information systems
that provide information to support managerial decision making. They
include:
• a. Management Information System (MIS)
• b. Decision Support System (DSS)
• c. Executive Information System (EIS)
• Executive Support System (ESS/EIS)
• An Executive information system (EIS), also known as an Executive support system
(ESS), is a type of management support system that facilitates and supports senior
executive information and decision-making needs. It provides easy access to internal and
external information relevant to organizational goals. Executive support systems are
intended to be used by the senior managers directly to provide support to non-
programmed decisions in strategic management. These information are often external,
unstructured and even uncertain. Exact scope and context of such information is often
not known beforehand.
• This information is intelligence based −
Market intelligence
Investment intelligence Technology intelligence
Following are some examples of intelligent information, which is often the source of an ESS
− External databases Technology reports like patent records etc.
Technical reports from consultants Market reports
Confidential information about competitors Speculative information like market
condition
Government policies Financial reports and information
• Charateristics of EIS:
• Detailed data – EIS provides absolute data from its existing
database.
• Integrate external and internal data – EIS integrates external
and internal data. The external data collected from various
sources.
• Presenting information – EIS represents available data in
graphical form which helps to analyze it easily.
• Trend analysis – EIS helps executives of the organizations to
data prediction based on trend data.
• Easy to use – It is a very simplest system to use.
• Advantages of EIS
• Trend Analysis
• Improvement of corporate performance in the marketplace
• Development of managerial leadership skills
• Improves decision-making
• Simple to use by senior executives
• Better reporting method
• Improved office efficiency
• Disadvantage of EIS
• Due to technical functions, not to easy to use by everyone
• Executives may encounter overload of information
• Difficult to manage database due to the large size of data
• Excessive costs for small business organizations
• COMPONENTS OF EIS
• USER INTERFACE: User Interface allows the users to communicate with
the EIS. User interface must be easy to use and understand. Users should
not be required to understand the complex query languages and other
mathematical or statistical formulas.
• HARDWARE: Hardware refers to devices by which users give input, data
processing and the output is received. Users may give input via keyboard
and mouse and CPU may be used for processing and output may be
received on monitor or from printer.
• SOFTWARE: Software is required for various calculations, providing
graphical view to the management, storing data in the form of
Information, etc. Software allows user to get information in the form it is
actually required.
• TELECOMMUNICATION: In today’s world the most important thing is
communication. Users may require transferring information from one
point to another point. The information might be a little confidential in
nature. The secrecy of the information should be well maintained.
• APPLICATIONS OF EIS
• MANUFACTURING: It determines whether a process is running correctly
or not. It helps in ensuring proper quality control of finished goods. It
measures the actual process time and compares with the standard time
required for the process. It provides management with daily production
report, daily consumption report, safety stock report, economic order
quantity, etc.
• FINANCIAL: Every organization needs to ensure financial activities are
running sound. EIS may help to analyze whether payment has been
realized from creditors within stipulated period of time. It can help
management in managing various other sources of finance.
• ACCOUNTING: It helps in proper accounting and disbursement of
accounting functions.
• https://www.youtube.com/watch?v=EHrcZBIA3Lg
 Expert systems
• In artificial intelligence, an expert system is a computer system emulating the
decision-making ability of a human expert. Expert systems are designed to
solve complex problems by reasoning through bodies of knowledge,
represented mainly as if–then rules rather than through conventional procedural
code.
• What is meant by expert systems?
Expert system, a computer program that uses artificial-intelligence methods to
solve problems within a specialized domain that ordinarily requires human
expertise.
Examples of ES:
MYCIN: It was based on backward chaining and could identify various
bacteria that could cause acute infections. ... It is one of the best Expert
System Example.
DENDRAL: Expert system used for chemical analysis to predict
molecular structure.
What industries use expert systems?
Expert systems are used widely in commercial and industrial settings,
including medicine, finance, manufacturing, and sales.
Components of Expert Systems
• An expert system is typically comprised of five components:
• a knowledge base that stores rules and knowledge in domains to form
procedures for solving problems.
• an inference engine that obtains data from the knowledge base and
interprets the data to find a solution to the problem. This component also
possesses debugging abilities to streamline the problem-solving process.
• a knowledge acquisition and learning module that allows the application
to acquire more data from sources and add it to the knowledge base;
• a user interface which enables non-expert users to access the expert
system and determine a solution; and
• an explanation module which helps the non-expert user explain how the
problem was solved.
• Steps to develop a ES:
• Determining the problem domain. This step involves identifying whether the
problem is appropriate for an expert system to solve, finding experts to
contribute to the project, and establishing whether solving the problem is cost-
effective for the business.
• Designing the system. This involves determining the degree of integration the
system will have with other systems and databases.
• Developing a prototype. This step involves obtaining domain knowledge from
the appropriate expert or experts and establishing rules for the expert system.
• Testing the prototype. This involves checking the prototype with sample
cases. This step allows engineers to pinpoint any deficiencies in the system.
This is also a time for end-users to test the system for usability, efficiency, and
accuracy.
• Refining and completing the prototype. This step ensures the expert system
integrates well with other systems and databases and works for all end-users as
well. In addition, this is the time to document the expert system project and
train all end users on how to use the expert system properly.
• Maintaining the expert system. This ongoing step involves regular reviewing
and updating of the knowledge base. In addition, the system must be kept up to
date as other integrated databases and information systems evolve over time.
Benefits of ES:
• Expert systems provide many benefits to companies that have adopted AI into their
customer service models. Here are just some of the advantages presented by expert
systems in artificial intelligence:
• Availability. Expert systems are mass-produced and, therefore, readily available to
any company willing to invest in an AI-powered system.
• Efficiency. Expert systems are speedy and reduce the amount of labor expended to
solve problems.
• Lower Production Costs. Production costs of expert systems are economical, and
thus the prices of expert systems are reasonable and accessible to many companies.
• Ability to Diagnose and Monitor Problems. Expert systems can monitor patterns
of issues that arise, pinpoint common problems, and address those problems over a
relatively short amount of time.
• Low Error Rate. Expert systems’ error rates are significantly lower than that of
human expert systems.
• Low-Risk Factor. Expert systems can be applied in environments that are unsafe
for humans.
• Consistent, Stable Response Rate. Expert systems are immune to tension and
fatigue and can continue to run during off-work hours at a constant level of
performance.
 KNOWLEDGE MANAGEMENT SYSTEM

• Knowledge management (KM) is the process of creating, sharing, using

and managing the knowledge and information of an organization. It refers
to a multidisciplinary approach to achieve organisational objectives by
making the best use of knowledge.
• The system organizes, stores, and retrieves the collective knowledge of an
organization. Ultimately, a Knowledge Management System ensures that
necessary information is available on demand, eliminating the need to
rediscover knowledge. Increasingly, knowledge management systems use
Artificial Intelligence technology for better efficiency.
• What Types of Knowledge Should be Included in a Knowledge
Management System?
• To fully capitalize on a Knowledge Management System, an organization needs
to gather three types of information.
• Explicit knowledge
This is knowledge that is easily documented, shared, and deployed. Examples
might include company policy, contract entitlements, blog posts, how-to
videos, user’s guides, troubleshooting manuals, and industry regulations.
• Tacit knowledge
Tacit Knowledge is gained from personal traits and experience and could be
more difficult to capture and disseminate. Per Gartner, it even includes
intuition and judgment. Sophisticated Knowledge Management Systems that
can leverage AI and reasoning fare better in their ability to do it.
• Implicit knowledge
Implicit knowledge is not consciously accessible, for example, knowing how to
ride a bicycle or swim. Another way is to look at Amnesia. When someone is
affected by it, they forget explicit and even tacit knowledge in many instances,
but not implicit.
The Benefits
• While knowledge management systems have broad applicability across the
enterprise, customer service has been a sweet spot. Despite their widely
varied products and missions, they have surprisingly similar reasons for
deploying a Knowledge Management System.
• Reduce the cost of customer service
By making it easier for contact center agents to find accurate information, a
Knowledge Management System reduces their average handling time of
resolving customer service issues. Faster resolution translates to happier
customers and efficient and happier employees.
• Help customers self-serve
An AI-powered Knowledge Management System can help customers find
answers to their questions, even outside of normal business hours and without
having to wait for an agent.
• Speed up employee training and onboarding
By providing relevant knowledge on demand, knowledge management
systems can reduce the need for training and protracted onboarding and speed
up employee time to competency.
• Faster information find ability and problem-solving
• Whether it’s solving customer service issues and providing expert advice to
customers in the case of contact centers, or answering employee questions in the
case of HR, a Knowledge Management System offers fast, accurate, and consistent
answers, and offers it proactively.
• Easily share expert knowledge
• How do you get knowledge from a business leader or veteran customer service
agent to others who need it? A Knowledge Management System provides the
repository for that knowledge and the mechanism through which it can be authored
and efficiently delivered across channels and touch points.
Essential features of a knowledge management system
A good knowledge base:
• A centralized, omnichannel knowledge base (or content base) is central to a
good KM system. The knowledge base software (KB) includes robust content
management capabilities for collaborative creation and single-sourced
publishing. Apart from using the centralized knowledge base, the knowledge
system enables migration of content from other knowledge bases and
federation of content from other CRM and legacy sources. Our Knowledge
Management implementation methodology includes sound content advice,
including what to federate, what to bring into our knowledge base, and when.
Scalability
• Can a Knowledge Management System house more information as your
organization acquires it? Can it scale across thousands of users? A scalable
Knowledge Management System is important to supporting growth in the
enterprise.
Multilingual support
• Supporting multiple languages is a necessity in the modern marketplace.
The best knowledge management software are multilingual allowing an
organization to present content in multiple languages using a single content
base. A best practice is to leverage the same core content with localization
where needed. Granular language controls and easy configurations allow an
organization to precisely control where different languages should be applied.
KMS integrations
• Knowledge Management System needs to be highly dynamic and leverage
data and context from other systems. Many of our customers integrate their
systems with existing systems.
• CRM systems
• Document management systems
• Content management systems
• Contact center systems
• Order management systems
• And more
Knowledge reporting and analytics
• Robust reporting and analytics within your software let you know how
many people are using your knowledge, which information is most helpful,
and if your customer service employees in the contact center or stores have
the information they need to answer customer questions. Knowledge
analytics is critical to optimizing the knowledge base and sustain its
effectiveness over time.
Feedback collection
• A Knowledge Management System that collects feedback not only helps
measure customer satisfaction, but it also helps employees report (often in
realtime) which information is helpful and where updates need to be made.
Viewership controls
• Subject matter experts, customer service agents, managers, and customers
all need to access different sets of information. Permission controls make
sure that the right information is available to the right audience.
• What are the top knowledge management systems
• Knowledge management is a big area and vendors come at it from
different angles. Here is a sample listing of vendors.
• eGain
• SharePoint (Microsoft)
• Documentum
• SugarCRM
• Infor
• Others (you can find these on various vendor listings on the web)
• Activities in Knowledge Management
Start with the business problem and the business value to be delivered first. Identify what kind of
strategy to pursue to deliver this value and address the KM problem.
Think about the system required from a people and process point of view.
Finally, think about what kind of technical infrastructure are required to support the people and
processes.
Implement system and processes with appropriate change management and iterative staged release.

Failure factors of knowledge management systems are as follows:

Inadequate support: managerial and technical, during both implementation and use.
Expecting that the technology is a KM solution in itself.
Failure to understand exactly what the firm needs (whether technologically or otherwise)
Not understanding the specific function and limitation of each individual system.
Lack of organizational acceptance, and assuming that if you build it, they will come – lack of
appropriate organizational culture.
Inadequate quality measures (e.g. lack of content management)..
Lack of organizational/departmental/etc fit - does it make working in the organization. easier? Is a
system appropriate in one area of the firm but not another? Does it actually disrupt existing processes?
Lack of understanding of knowledge dynamics and the inherent difficulty in transferring tacit
knowledge with IT based systems .
Lack of a separate budget.
The process of implementing KMS:
1. Adoption
2. Acceptance
3. Assimilation

Step 1: KMS Adoption

Some of the key factors identified by Hecht et al (2011) are: characteristics,
commercial advantage, cultural values, information quality, organizational
viability, and system quality.
To promote KMS adoption:
Start with an internal analysis of the firm.
Evaluate information/knowledge needs & flows, lines of communication,
communities of practice, etc. These findings should form the basis of determining
the systems needed to complement them.
Make a thorough cost-benefit analysis, considering factors like size of firm,
number of users, complexity of the system structure, frequency of use, upkeep &
updating costs, security issues, training costs (including ensuring acceptance) etc.
vs improvements in performance, lower response time, lower costs (relative to the
previous systems) etc.
Evaluate existing work practices and determine how the systems will improve -
and not hinder - the status quo.
Step 2: KMS acceptance
Some of the factors outlined by Hecht et al. (2011) include: anxiety, ease of
use, intrinsic motivation, job-fit, results demonstrability, and social factors.
Promoting acceptance can be improved by:
Involve the users in the design and implementation process when possible
Involve the user in the evaluation of the system when applicable
Make it as user friendly and as intuitive as possible
Support multiple perspectives of the stored knowledge
Provide adequate technical and managerial support.
Use product champions to promote the new systems throughout the
organization.
Step 3: KMS Assimilation
Some of the factors identified by Hecht et al. (2011) include: knowledge
barrier, management championship, process cost, process quality, and
promotion of collaboration. Assimilation can be improved by:
Content management : In order for the system to remain useful, its content
must be kept relevant through updating, revising, filtering, organization, etc.
Perceived attractiveness factors : This includes not only the advantages of
using the KMS, but also of management's ability to convince users of these
advantages.
Proper budgeting: i.e. planning expenses and implementing a KMS that is
cost efficient.
Management involvement: The system must be championed by management
at all levels. Essential features of a knowledge management software
• Components of the transaction processing system (TPS)
• The components of TPS are:-
• Inputs
• Storage
• Processing
• Output
• Inputs are invoices and customer orders. The processing is done on the
inputs. Storage is in the form of ledgers. Output is the generated record
from the TPS software.
• Types of the transaction processing system (TPS)
• There are two types of TPS:-
1. Batch processing system
• A transaction that is done in a batch or group is known as a batch processing system.
The batch processing is not done immediately. First, the data is collected and then
placed in a group or batch then the processing is started.
• Examples of batch processing systems are:-
• Credit card transaction
• Payment by cheque
• Generation of bills

2. The online transaction processing system

• A transaction that is done immediately without any delay is known as an online
transaction processing system (OLTP). It is also known as a real-time transaction.
• Examples of OLTP are:-
• Use card for payment, ATM transactions, weather forecasts etc
• Online transaction
• Examples of the transaction processing system (TPS)
• Electronic transfer of funds
• Airline reservation system
• Bank account processing system
 Customer relationship management

Customer relationship management (CRM) is a technology for managing all

your company's relationships and interactions with customers and
potential customers. The goal is simple: Improve business relationships. A
CRM system helps companies stay connected to customers, streamline
processes, and improve profitability.
Why CRM benefits businesses:
• The use of CRM systems can benefit organizations ranging from small
businesses to large corporations, through:
• Having customer information such as past purchases and interaction history
easily accessible can help customer support representatives provide better
and faster customer service.
• Collection of and access to customer data can help businesses identify
trends and insights about their customers through reporting and
visualization features.
• Components of CRM:
At the most basic level, CRM software consolidates customer information and
documents it into a single CRM database so business users can more easily
access and manage it.
• Marketing automation. CRM tools with marketing
automation capabilities can automate repetitive tasks to enhance marketing
efforts at different points in the lifecycle for lead generation. For example,
as sales prospects come into the system, it might automatically send email
marketing content, with the goal of turning a sales lead into a full-fledged
customer.
• Sales force automation. Sales force automation tools track customer
interactions and automate certain business functions of the sales cycle that
are necessary to follow leads, obtain new customers and build customer
loyalty.
• Contact center automation. Designed to reduce tedious aspects of a
contact center agent's job, contact center automation might include
prerecorded audio that assists in customer problem-solving and information
dissemination.
• workflow automation. CRM systems help businesses optimize processes
by streamlining mundane workloads, enabling employees to focus on
creative and more high-level tasks.
• Lead management. Sales leads can be tracked through CRM, enabling
sales teams to input, track and analyze data for leads in one place.
• Human resource management (HRM). CRM systems help track
employee information, such as contact information, performance reviews
and benefits within a company. This enables the HR department to more
effectively manage the internal workforce.
• Analytics. Analytics in CRM help create better customer satisfaction rates
by analyzing user data and helping create targeted marketing campaigns.