Category: Management Notes

An MIS is a system designed to provide selected decision oriented information needed by management to plan, control and evaluate the activities of the corporation. It is designed within a framework that emphasizes profit planning, performance planning and control at all levels.

A formal method of collecting timely information in a presentable form in order to facilitate effective decision making and implementation, in order to carryout organizational operations for the purpose of achieving the organizational goal.

Information processing beyond doubt is the dominant industry of the present century. Following factors states few common factors that reflect on the needs and objectives of the information processing:

• Increasing impact of information processing for organizational decision making.
• Dependency of services sector including banking, financial organization, health care, entertainment, tourism and travel, education and numerous others on information.
• Changing employment scene world over, shifting base from manual agricultural to machine-based manufacturing and other industry related jobs.
• Information revolution and the overall development scenario.
• Growth of IT industry and its strategic importance.
• Strong growth of information services fuelled by increasing competition and reduced product life cycle.
• Need for sustainable development and quality life.
• Improvement in communication and transportation brought in by use of information processing.
• Use of information processing in reduction of energy consumption, reduction in pollution and a better ecological balance in future.
• Use of information processing in land record managements, legal delivery system, educational institutions, natural resource planning, customer relation management and so on.
• MIS is very useful for efficient and effective planning and control functions of the management. Management is the art of getting things done through others. MIS will be instrumental in getting the things done by providing quick and timely information to the management.
• Reports give an idea about the performance of men, materials, machinery, money and management. Reports throw light on the utilization of resources employed in the organization.
• MIS is helpful in controlling costs by giving information about idle time, labour turnover, wastages and losses and surplus capacity.
• By making comparison of actual performance with the standard and budgeted performance, variances are brought to the notice of the management by MIS which can be corrected by taking remedial steps.
• MIS brings to the notice of the management strength (i.e., strong points) of the organisation, to take advantage of the opportunities available.
• MIS reports on production statistics regarding rejection, defective and spoilage and their effect on costs and quality of the products.

A management information system, or MIS, is any computer system used to collect and store information, with tools for analyzing that information so that you can monitor operations and make informed business decisions. Software that tracks sales data, produces weekly reports and expands on past sales to provide you with sales forecasts would be one example of a management information system. More sophisticated systems could track production in different departments, monitor inventory, keep track of costs and even monitor the company’s stocks.

In the past, MIS was often a system that ran independently of other company systems. At one time, it would be found almost exclusively on mainframe computers and the information it processed was used exclusively by management. Today, MIS is often used interchangeably with information systems (IS) as well as information technology (IT).

The Five Eras of MIS

In order to make sense of the evolution of management information systems, it’s helpful to break down the history into four or five eras.

First Era (mid-1960s to mid-1970s)

During the first years of computerized MIS, information systems were centralized and concerned solely with governance and the needs of management. Most information systems and their reports were under the control of accounting departments. Technology included third-generation mainframe computers, like the IBM 360. Languages included Assembler, Fortran, COBO and, Database e. Ethernet networks were developed during this time.

Second Era (mid-1970s to mid-1980s)

While MIS was still mainly concerned with governance and the needs of management, more departments were beginning to benefit from the technology. In many companies, steering committees and user-led initiatives determined the shape and scope of additional IS projects. Technology included the first personal computers (PCs), minicomputers and mid-range computers.

Third Era (mid-1980s to late 1990s)

During the third era, centralized information systems began to spread out and information became decentralized. Each department had its own computer system. Managing information was often referred to as “herding cats.” It was during this era that a new position emerged in many companies to oversee the acquisition and management of multiple information systems: the Chief Information Officer, or CIO. Technology during this era included internetworking and the beginning of the internet.

Fourth Era (late 1990s to today)

During the current era, information systems are still tightly tied to governance and management, however the systems are widely distributed, within the reach of nearly every employee who needs it across multiple platforms. Many information systems are integrated between different companies, so that a client business can readily access supplier information and their customers, in turn, can access that information. Technology now includes social media, search engines and ubiquitous computing through a variety of platforms including laptops, tablets and smartphones.

Fifth Era (today forward)

The increase in internet bandwidth over recent years has led to a substantial reliance on cloud computing. As a result, some maintain that this marks a new era in worker’s ascendancy and that we are now in a fifth era for management information systems. Today, practically any employee is now in a position to make informed decisions with tools that are readily available across multiple platforms. Furthermore, the line between who produces and who consumes MIS information is increasingly blurred.

Evolution of Management due to Technology

This could mark the end of controlling top-down management styles, which are being replaced by more autonomy of employees. Management expert Peter Druker predicted this as an inevitable back in 1954 in his theory on Management by Objectives. In this paradigm, top-down management can actually harm a company because, being in the trenches, employees are more and more likely to understand customer needs better than their supervisors and, being in specialized fields, may have more understanding of the nuts and bolts behind a business than those supervisors.

“Knowledge workers have to manage themselves,” Drucker said. “They have to have autonomy.”

Origin of Management Information Systems

The history of information management can be traced back to the industrial exhibition of Paris in 1801. There, Joseph Marie Charles Jacquard introduced the world to punch cards. These cards, which were similar to the computer punch cards used through much of the 20th century, were used in weaving looms to make intricate patterns in cloth.

The Creation of Punch Card Systems

At that time, looms were hand-operated and if you wanted to create a complex pattern in cloth, you had to know – and remember – the order that different color threads were to be weaved into the fabric. Jacquard’s punch cards had multiple rows of holes punched into them. Each card represented a single row of threads in the cloth. The cards, when strung together and inserted into the loom, would determine the pattern in the cloth.

If you changed the order in which the cards were inserted, you would change the pattern. If you used the same order every time, every piece of cloth would have the exact same pattern.

Thus, for the first time, Jacquard’s punch cards could automate the storage and management of the information used to specify how a loom was to be operated.

Evolution of Punch Cards

The use of punch cards expanded in the following decades and in the 1880s, punch cards were used to compile information. Cards were “programmed” with information by punch card machines and other machines would process these cards, tally them and print out the results.

By 1911, IBM emerged, then called the Computing-Tabulating-Recording Company. By this time, punch cards were used for recording and storing all sorts of information, including time tracking and recording weights on scales. Even the U.S. Census was using punch cards to manage its information.

The Emergence of MIS in Computers

When computers began to emerge in the 1940s and 1950s, punch cards were still a big part of information systems. They continued to play a role until the 1970s when they were replaced by magnetic storage media like tapes and disks. These storage devices greatly increased the speed of calculating data Consequently, MIS began to develop for accounting. Calculating data and compiling it into reports could now be done in a fraction of the time it would have taken before.

MIS Developing Beyond Accounting

From the 1970s to the early 1990s, as computers became smaller, faster and more affordable, MIS developed beyond accounting to other business areas, like inventory systems, sales, marketing, manufacturing processes and engineering. Most of these systems ran independently of each other, each using different software on different computers. For a large company to get a complete picture of its progress, reports from different departments would be re-entered into another system, often in a mainframe computer. Small businesses simply didn’t have the resources to complete such an endeavor and would have to compile different reports manually, often on paper.

Even as computers could be connected in networks in the 1990s, the different software systems were often not compatible. Companies then began upgrading their systems so that different department systems could communicate with each other. By the end of the 1990s, even small businesses could afford integrated information systems and even connect different office systems together using the internet.

Translating the real concept of the MIS into reality is technically, an infeasible proposition unless computers are used. The MIS relies its ability to store, process, retrieve and communicate with no serious limitations.

The variety of the hardware having distinct capabilities make it possible to design the MIS for a specific situation. For example, if the organization needs a large database and very little processing, a computer system is available for such a requirement. Suppose the organization has multiple business locations at long distances and if the need is to bring the data at one place, process, and then send the information to various locations, it is possible to have a computer system with a distributed data processing capability.  If the distance is too long, then the computer system can be hooked through a satellite communication system.

Role of Computers in Management Information Systems

Computers play a central role in a business’s management information system, or MIS. In past decades, most companies had a few computers that served as information hubs. Today, a range of computing devices funnel important data from a variety of sources, from sales to time cards to inventory. The MIS software gathers the data and generates actionable information to guide the business.

1. Guiding the Business

Business doesn’t stand still. Internal and external circumstances change daily, and you need a road map of good information to guide you through the twists and turns. The whole purpose of MIS is to use the hard data of your business to inform day-to-day and long-term decisions. Computers ease the task of processing the data.

2. Capturing the Data

The most sophisticated computers in the world can’t help your business if they’re not “fed”. Before an MIS can provide useful information, data must first enter the system.

Sales and accounting systems, for example, typically capture data when a customer places an order. Workers on the factory floor can enter manufacturing data into tablets or PCs, or the production machines themselves can capture data automatically. These detailed, nuts-and-bolts numbers are the raw materials that eventually become useful management information.

3. Calculating, Sorting and Searching

Modern computers excel at repetitive number crunching, accurately processing many thousands of data items per second. To summarize a month’s business transactions by hand might take hours or days, while a computer can do this task in moments. Useful operations include arithmetic calculations, sorting data numerically or alphabetically and searching for a single record among thousands in a file.

4. Database Management Systems

Many MIS systems rely on database management systems to organize, process and protect data. The database is a special program that acts as a data warehouse, storing the raw data and also cataloging it. The database has levels of security to guard against unauthorized access. It gives the various MIS applications accounting, payroll, inventory management and others added efficiency, reliability and flexibility.

5. Reports for Managers

An MIS delivers information to managers in the form of reports. They may take many forms, including printed lists, informative screens or alerts by text or email. Generally, reports may have details, listing individual records sorted by date or other criteria, and summary figures that show totals and averages.

For example, a monthly sales report shows customer names and what they bought. The MIS may generate the reports on demand, on a schedule or when preset conditions are met.

6. Ad Hoc Reporting

Many of the reports in an MIS system are “canned”, as software developers wrote the specifications when the system was first created. Ad hoc (improvised) reports are also possible. In this instance, you can use database software to create a custom report.

For example, in a certain month, an item you make may have been painted the wrong color. An ad hoc report can pull useful information from the MIS, such as who bought the item and when or which production machine made the item. The manager may create the report herself from a menu-driven reporting system, or she may ask a data technician to do it for her.

7. Computer Storage and Big Data

With the falling price of computer hard drives, it’s now possible to store enormous amounts of information cheaply. Even small businesses can afford to keep reams of detailed records on hand and use them to study customer buying patterns, production quality statistics and the actions of competitors.

8. Garbage In, Garbage Out

With tongue in cheek, computer professionals use the term “garbage in, garbage out” to sum up how errors in data or mistakes in programming can lead to disastrous outcomes. Because computers deal with large amounts of information, it’s possible that small arithmetic errors, for example, may give wildly incorrect results. Savvy businesspeople must be aware of the potential pitfalls of relying too much on computerized reports.

The impact of MIS on the functions is in its management.  With a good MIS support, the management of marketing, finance, production and personnel becomes more efficient, the tracking and monitoring the functional targets becomes easy. The functional managers are informed about the progress, achievements and shortfalls in the activity and the targets. The manager is kept alert by providing certain information indicating the probable trends in the various aspects of business. This helps in forecasting and long-term perspective planning.  The manager” attention is brought to a situation which is exceptional in nature, inducing him to take an action or a decision in the matter. A disciplined information reporting system creates a structured database and a knowledge base for all the people in the organization. The information is available in such a form that it can be used straight away or by blending and analysis, saving the manager’s valuable time.

The MIS creates another impact in the organization which relates to the understanding of the business itself. The MIS begins with the definition of a data entity and its attributes. It uses a dictionary of data, entity and attributes, respectively, designed for information generation in the organization. Since all the information systems use the dictionary, there is common understanding of terms and terminology in the organization bringing clarity in the communication and a similar understanding of an event in the organization.

The MIS calls for a systemization of the business operations for an effective system design. This leads to streamlining of the operations which complicate the system design.  It improves the administration of the business by bringing a discipline in its operations everybody is required to follow and use systems and procedures. This process brings a high degree of professionalism in the business operations.

Since the goals and objective of the MIS are the products of business goals and objectives, it helps indirectly to pull the entire organization in one direction towards the corporate goals and objectives by providing the relevant information to the people in the organization.

A well designed system with a focus on the manager makes an impact on the managerial efficiency.  The fund of information motivates an enlightened manager to use a variety of tools of the management. It helps him to resort to such exercises as experimentation and modeling. The use of computers enables him to use the tools and techniques which are impossible to use manually. The ready-made packages make this task simpler. The impact is on the managerial ability to perform. It improves the decision making ability considerably.

Advantage of Computer-Based Management Information System

Compute-based Management information systems have been in widespread use since the 1990s in industry, non-profit organizations and government agencies. These systems provide fast, centralized access to databases of personnel information, reference reading, best practices and on-the-job training, and are easily customizable to meet an organization’s needs. With the Internet and technology boom of the early 21st century, use of computer-based information networks is growing faster each year.

1. Data Centrality

Access to data via a computer network information system is central, providing a “one-stop” location to find and access pertinent computer data. Most large-scale businesses and organizations use some sort of central database to manage user information, manage advertisement lists, store product information and keep track of orders. Examples of central database solutions are MySQL, PostgreSQL or Microsoft SQL database solutions, coupled with custom software which provides user interfaces.

2. Information Coverage

Central information systems provide organizations with the advantages of having large amounts of data, covering many different fields, all accessible via a central source. Information coverage is a huge advantage for any organization, because having vast amounts of useful data from every different department streamlines access and increases productivity. For users, having access to a networked information system is analogous to having a digital library of shared knowledge. Recent developments in database information systems link company information access with larger databases of academic and professional research, such as Google Scholar, to provide even more information capability to personnel.

3. Access Efficiency

Efficiency of access is a crucial advantage to networked information systems over more traditional information management systems, such as paper cataloging and filing. Computer-based information systems catalog and file documents in a set logical way, making data access very efficient and fast. Data can be manually categorized, and filters created to automatically file documents that match certain patterns. This increases employee productivity time by allowing workers to focus more on the task at hand rather than filing paperwork.

4. Extensibility

Computer-based information systems are completely extensible and customizable to an organization’s needs. Upon installation, customized computer information systems use configuration files that are tailor-made to an organization’s needs to file and categorize data. Computer software engineers frequently design custom database interfaces and information storage/recovery systems for enterprise clients. As a company grows, modifications and additions to this filing configuration allow easy extensibility. Computer information systems are not limited in scale or possibility. They are uniquely designed for maximum organizational benefit for each customer.

Disadvantage of Computer-Based Management Information System

1. Lack of common sense

Computer is only an electronic device. It cannot think. If we provide an incorrect data, it does not have the commonsense to question the correctness of the data. For overcoming this problem, several Software Specialists are engaged in the project of developing intelligence to the computer. To it, they have given name as Artificial Intelligence. They are willing to develop the feeling and inhumation in this device.

We hope that in near future the artificial intelligence will help this device to function in more interactive way. Today, software’s are available which may convert our speech into text. This is the beginning of an era where computer may be quite interactive with human beings. In addition, to execute the function, operator will give verbal instructions.

2. Memory without brain

Computer can store data in its memory. However, if a wrong instruction is provided, it does not have a brain to correct the wrong instructions

3. Slavery

A computer is a slave; it cannot execute the program by itself. It requires instructions to execute the program and generate information. Thus, we see that the computer cannot do anything by itself. It has a relationship of master and slave. Until master is not instructing, slave will not perform any function. In the same way computer does.

Information classification is a process in which organizations assess the data that they hold and the level of protection it should be given.

Organizations usually classify information in terms of confidentiality i.e. who is granted access to see it. A typical system will include four levels of confidentiality:

• Confidential (only senior management have access)
• Restricted (most employees have access)
• Internal (all employees have access)
• Public (everyone has access)

As you might expect, larger and more complex organizations will need more levels.

Take hospitals, for example: doctors and nurses need access to patients’ medical histories, which are highly sensitive, but they shouldn’t have access to other types of information that would fit that criteria, such as the hospital’s financial records.

Classification by Characteristic

Based on Anthony’s classification of Management, information used in business for decision-making is generally categorized into three types:

1. Strategic Information

Strategic information is concerned with long term policy decisions that defines the objectives of a business and checks how well these objectives are met. For example, acquiring a new plant, a new product, diversification of business etc, comes under strategic information.

2. Tactical Information

Tactical information is concerned with the information needed for exercising control over business resources, like budgeting, quality control, service level, inventory level, productivity level etc.

3. Operational Information

Operational information is concerned with plant/business level information and is used to ensure proper conduction of specific operational tasks as planned/intended. Various operator specific, machine specific and shift specific jobs for quality control checks comes under this category.

Classification by Application

In terms of applications, information can be categorized as:

1. Planning Information

These are the information needed for establishing standard norms and specifications in an organization. This information is used in strategic, tactical, and operation planning of any activity. Examples of such information are time standards, design standards.

2. Control Information

This information is needed for establishing control over all business activities through feedback mechanism. This information is used for controlling attainment, nature and utilization of important processes in a system. When such information reflects a deviation from the established standards, the system should induce a decision or an action leading to control.

3. Knowledge Information

Knowledge is defined as “information about information”. Knowledge information is acquired through experience and learning, and collected from archival data and research studies.

4. Organizational Information

Organizational information deals with an organization’s environment, culture in the light of its objectives. Karl Weick’s Organizational Information Theory emphasizes that an organization reduces its equivocality or uncertainty by collecting, managing and using these information prudently. This information is used by everybody in the organization; examples of such information are employee and payroll information.

5. Functional/Operational Information

This is operation specific information. For example, daily schedules in a manufacturing plant that refers to the detailed assignment of jobs to machines or machines to operators. In a service oriented business, it would be the duty roster of various personnel. This information is mostly internal to the organization.

6. Database Information

Database information construes large quantities of information that has multiple usage and application. Such information is stored, retrieved and managed to create databases. For example, material specification or supplier information is stored for multiple users.

Information, as required at different levels of manage­ment can be classified as operational, tactical and strategic.

1. Strategic information

While the operational information is needed to find out how the given activity can be performed better, strategic information is needed for making choices among the busi­ness options.

The strategic information helps in identifying and evaluating these options so that a manager makes informed choices which are different from the competitors and the limita­tions of what the rivals are doing or planning to do. Such choices are made by leaders only.

Strategic information is used by man­agers to define goals and priorities, initiate new programmes and develop policies for acquisition and use of corporate resources. For example, information regarding the long-term needs of funds for on-going and future projects of the company may be used by top level managers in taking decision regarding going public or approaching financial institutions for term loan.

Strategic infor­mation is predictive in nature, relies heavily on external sources of data, has a long-term perspective, and is mostly in summary form. It may sometimes include ‘what if’ scenarios. However, the strategic information is not only external information.

For long, it was believed that strategic information are basically information regarding the external environment. However, it is now well rec­ognised that the internal factors are equally responsible for suc­cess or failures of strategies and thus, internal information is also required for strategic decision making.

Figure represents the types of information required at different levels of managerial hierarchy.

It may be remembered that each type of information has its role to play in managerial effectiveness. Each type of information is needed with varying degree by the managers at all levels. Thus, a part of operational information may be used even by the chief executive of­ficer of a company.

The difference lies in the proportion of each type of information in the total information needs of managers at different levels of managerial hierarchy.

2. Tactical information

Tactical information helps middle level man­agers allocating resources and establishing controls to implement the top level plans of the organisation. For example, information regarding the alternative sources of funds and their uses in the short run, opportunities for deployment of surplus funds in short- term securities, etc. may be required at the middle levels of man­agement.

The tactical information is generally predictive, focusing on short-term trends. It may be partly current and partly histori­cal, and may come from internal as well as external sources.

3. Operational information

Operational information relates to the day-to-day operations of the organization and thus, is useful in ex­ercising control over the operations that are repetitive in nature. Since such activities are controlled at lower levels of management, operational information is needed by the lower management.

For example, the information regarding the cash position on day-to-day basis is monitored and controlled at the lower levels of manage­ment. Similarly, in marketing function, daily and weekly sales in­formation is used by lower level manager to monitor the perform­ance of the sales force.

It may be noted that operational informa­tion pertains to activities that are easily measurable by specific standards. The operational information mainly relates to current and historical performance, and is based primarily on internal sources of data. The predictive element in operational information is quite low and if at all it is there, it has a short term horizon.

1. Observation

Observation method has occupied an important place in descriptive sociological research. It is the most significant and common technique of data collection. Analysis of questionnaire responses is concerned with what people think and do as revealed by what they put on paper. The responses in interview are revealed by what people express in conversation with the interviewer. Observation seeks to ascertain what people think and do by watching them in action as they express themselves in various situations and activities.

Observation is the process in which one or more persons observe what is occurring in some real life situation and they classify and record pertinent happenings according to some planned schemes. It is used to evaluate the overt behaviour of individuals in controlled or uncontrolled situation. It is a method of research which deals with the external behaviour of persons in appropriate situations.

According to P.V. Young, “Observation is a systematic and deliberate study through eye, of spontaneous occurrences at the time they occur. The purpose of observation is to perceive the nature and extent of significant interrelated elements within complex social phenomena, culture patterns or human conduct”.

From this definition it is clearly understood that observation is a systematic viewing with the help of the eye. Its objective is to discover important mutual relations between spontaneously occurring events and explore the crucial facts of an event or a situation. So it is clearly visible that observation is not simply a random perceiving, but a close look at crucial facts. It is a planned, purposive, systematic and deliberate effort to focus on the significant facts of a situation.

According to Oxford Concise Dictionary, “Observation means accurate watching, knowing of phenomena as they occur in nature with regard to cause and effect or mutual relations”.

This definition focuses on two important points:

Firstly, in observation the observer wants to explore the cause-effect relationships between facts of a phenomenon.

Secondly, various facts are watched accurately, carefully and recorded by the observer.

2. Interview

Interview as a technique of data collection is very popular and extensively used in every field of social research. The interview is, in a sense, an oral questionnaire. Instead of writing the response, the interviewee or subject gives the needed information verbally in a face-to-face relationship. The dynamics of interviewing, however, involves much more than an oral questionnaire.

Interview is relatively more flexible tool than any written inquiry form and permits explanation, adjustment and variation according to the situation. The observational methods, as we know, are restricted mostly to non-verbal acts. So these are understandably not so effective in giving information about person’s past and private behaviour, future actions, attitudes, perceptions, faiths, beliefs thought processes, motivations etc.

The interview method as a verbal method is quite significant in securing data about all these aspects. In this method a researcher or an interviewer can interact with his respondents and know their inner feelings and reactions. G.W. Allport in his classic statement sums this up beautifully by saying that “if you want to know how people feel, what they experience and what they remember, what their emotions and motives are like and the reasons for acting as they do, why not ask them”.

Interview is a direct method of inquiry. It is simply stated as a social process in which a person known as the interviewer asks questions usually in a face to face contact to the other person or persons known as interviewee or interviewees. The interviewee responds to these and the interviewer collects various information from these responses through a very healthy and friendly social interaction.

However, it does not mean that all the time it is the interviewer who asks the questions. Often the interviewee may also ask certain questions and the interviewer responds to these. But usually the interviewer initiates the interview and collects the information from the interviewee.

Interview is not a simple two-way conversation between an interrogator and informant. According to P.V. Young, “interview may be regarded as a systematic method by which a person enters more or less imaginatively into the life of a comparative stranger”. It is a mutual interaction of each other.

The objectives of the interviewer are to penetrate the outer and inner life of persons and to collect information pertaining to a wide range of their experiences in which the interviewee may wish to rehearse his past, define his present and canvass his future possibilities. These answers of the interviewees may not be only a response to a question but also a stimulus to progressive series of other relevant statements about social and personal phenomena.

In similar fashion, W.J. Goode and P.K Hatt have observed that “interviewing is fundamentally a process of social interaction”. In the interview two persons are not merely present at the same place but also influence each other emotionally and intellectually.

3. Schedule

Schedule is one of the very commonly used tools of data collection in scientific investigation. P.V. Young says “The schedule has been used for collection of personal preferences, social attitudes, beliefs, opinions, behaviour patterns, group practices and habits and much other data”. The increasing use of schedule is probably due to increased emphasis by social scientists on quantitative measurement of uniformly accumulated data.

Schedule is very much similar to questionnaire and there is very little difference between the two so far as their construction is concerned. The main difference between these two is that whereas the schedule is used in direct interview on direct observation and in it the questions are asked and filled by the researcher himself, the questionnaire is generally mailed to the respondent, who fills it up and returns it to the researcher. Thus the main difference between them lies in the method of obtaining data.

Goode and Hatt says, “Schedule is the name usually applied to a set of questions which are asked and filled by an interviewer in a face to face situation with other person”. Webster defines a schedule as “a formal list, a catalogue or inventory and may be a counting device, used in formal and standardized inquiries, the sole purpose of which is aiding in the collection of quantitative cross-sectional data”.

The success of schedule largely depends on the efficiency and tactfulness of the interviewer rather than the quality of questions posed. Because the interviewer himself asks all the questions and fills the answers all by himself, here the quality of question has less significance.

4. Questionnaire

Questionnaire provides the most speedy and simple technique of gathering data about groups of individuals scattered in a wide and extended field. In this method, a questionnaire form is sent usually by post to the persons concerned, with a request to answer the questions and return the questionnaire.

According to Goode and Hatt “It is a device for securing answers to questions by using a form which the respondent fills in himself. According to GA. Lundberg “Fundamentally the questionnaire is a set of stimuli to which illiterate people are exposed in order to observe their verbal behaviour under these stimuli”.

Often the term “questionnaire” and “schedule” are considered as synonyms. Technically, however, there is a difference between these two terms. A questionnaire consists of a set of questions printed or typed in a systematic order on a form or set of forms. These form or forms are usually sent by the post to the respondents who are expected to read and understand the questions and reply to them in writing in the spaces given for the purposes on the said form or forms. Here the respondents have to answer the questions on their own.

On the other hand schedule is also a form or set of forms containing a number of questions. But here the researcher or field worker puts the question to the respondent in a face to face situation, clarifies their doubts, offers the necessary explanation and most significantly fills their answers in the relevant spaces provided for the purpose.

Since the questionnaire is sent to a selected number of individuals, its scope is rather limited but within its limited scope it can prove to be the most effective means of eliciting information, provided that it is well formulated and the respondent fills it properly.

A properly constructed and administered questionnaire may serve as a most appropriate and useful data gathering device.

5. Projective Techniques

The psychologists and psychiatrists had first devised projective techniques for the diagnosis and treatment of patients afflicted by emotional disorders. Such techniques are adopted to present a comprehensive profile of the individual’s personality structure, his conflicts and complexes and his emotional needs. Adoption of such techniques is not an easy affair. It requires intensive specialized training.

The stimuli applied in projective tests may arouse in the individuals, undergoing the tests, varieties of reaction. Hence, in projective tests the individual’s responses to the stimulus situation are not considerate at their face value because there are no ‘right’ or ‘wrong’ answers. Rather emphasis is laid on his perception or the meaning he attaches to it and the way in which the endeavors to manipulate it or organizes it.

The purpose is never clearly indicated by the nature of the stimuli and the way of their presentation. This also does not provide the way of interpretation of the responses. Since the individual is not asked to describe about himself directly and since he is provided with stimulus in the form of a photograph or a picture or on ink- blot, etc., the responses to these stimuli are construed as the indicators of the individual’s own view of the world, his personality structure, his needs, tensions and anxieties etc. says Bell.

6. Case Study Method

According to Biesanz and Biesenz “the case study is a form of qualitative analysis involving the very careful and complete observation of a person, a situation or an institution.” In the words of Goode and Hatt, “Case study is a way of organizing social data so as to preserve the unitary character of the social object being studied.” P.V. young defines case study as a method of exploring and analyzing the life of a social unit, be that a person, a family, an institution, cultural group or even entire community.”

In the words of Giddings “the case under investigation may be one human individual only or only an episode in first life or it might conceivably be a Nation or an epoch of history.” Ruth Strong maintains that “the case history or study is a synthesis and interpretation of information about a person and his relationship to his environment collected by means of many techniques.”

Shaw and Clifford hold that “case study method emphasizes the total situation or combination of factors, the description of the process or consequences of events in which behaviour occurs, the study of individual behaviour in its total setting and the analysis and comparison of cases leading to formulation of hypothesis.”

The value of information is a very slippery concept as information per se does not have any universal value. Its value is related to the person who uses it, when he uses it and for what he uses it. Any assessment of the value of information is therefore related to the value of the decision-making supported by such information.

For example consider two persons lost in the Sahara desert. One person has an adequate supply of drinking water (more than he could desire) and another has exhausted his supply. If one were to approach these two individuals with information about a drinking water well in the surrounding, such information will obviously have greater value for the one who has exhausted his water supply. For the one who is thirsty, this information is the most valuable piece of information for him at that point of time as it will determine if he will survive. If by chance the information reaches this thirsty person late and he dies of thirst, then the value of the same information becomes zero. So we can see that the same information can have different value for different people at different points in time. Hence, it will be fair to conclude that value of information is relative. There is no absolute value of information.

However, the normal mathematical and economical explanation of value of information suggests that if an event occurs whose expectation was low and information of its occurrence is known then such information is valuable. For example let us say that the reader of this text gets the information that an earthquake of 10.5 magnitude in the Richter scale is going to hit India and the epicenter of the earthquake will be the very spot on which he is located, then that information is more valuable to him than the information (say) that he has to pass his BCA exam to get into the MCA course. In the former case the information is more valuable to him as he is not expecting it but in the latter case he already knows the information with certainty and expects it fully and hence the value for such information is less. All market mechanisms work on this model of information. This has already been dealt with in the earlier chapter and as Eq.1 suggests, the value of information of an event is the negative logarithm of the probability of occurrence of the event. Therefore, the more unlikely the event the more its information value, if communicated correctly. This is also exhibited in our behavior as eons of evolutions have shaped us in a manner that we tend to attach more value to unlikely events. In a game setting for example, say a horse racing game, if the odds of a horse winning the race are more then the payoff for that horse is less. Similarly, if a stock in the stock market is likely to outperform the market then the price payoff for that stock is not high, but if a stock that is likely to underperforms, performs beyond expectation, then the price payoff become very high. Thus, we can that the issue of value of information is a complicated one.

Normative Value of Information

Marschak (1971) and McGuire (1972) made seminal contributions to this field of work. Decision theory has developed this concept further and the basic assumption is that we always have some preliminary information about the occurrence of events that are related to our decisions. This information or knowledge is represented by an a priori assignment of probability of occurrence to the event and hence a calculated payoff. The a priori probability might be objective or subjective as the case may be and with the knowledge of additional information the probabilities are modified resulting in a change in the expected payoffs. This approach is however, only good for theoretical discussions as its practical applicability is poor. The problem for such cases has to be highly structured, which is rarely the case in management.

Subjective Value of Information

It is the subject view of the information available. It is the subjective perception or impression of the information. This subjective value approach varies widely with individuals. In the subjective valuation of information, no probabilities are calculated. Subjective value of information is the person’s (receiver’s) comprehensive impression about the information content.