What is management information system?

A management information system is-
• An integrated user-machine system
• For providing information
• To support the operations, management, analysis and decision-making functions
• In an organization

The system utilises-
• Computer hardware and software
• Manual procedures
• Models for analysis, planning, control and decision making, and
• A database

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Introduction:

The “Hindustan institute of maritime training” is an educational institute, which imparts qualitative education to enable people working in ships to revalidate their certificates and to take up new and exciting courses in this particular field.

The “Hindustan institute of maritime training” offers around 50+ courses in different packages, for the benefit of the students. It also offers real time practical knowledge, which enables the students to experience the real situations of shipment so that they can tackle them in an efficient manner.

The institute of maritime training keeping in view the most important and vital time factor has designed short-term courses so that the persons availing the courses can have to their credit the availed courses in short span of time.

This institution has been rendering service from past 9 years. In this short span it has incorporated many new and innovative ways of providing training with the help of latest technology.

Recognition:

It has been recognised as one of the major institute by Mercantile Marine Department of Chennai. The Mercantile Marine Department governs the entire working of the institute.

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Features:

 An educational training institute.

 It has been in existence from past nine years.

 The entire working is governed by MMD

 Located in the heart of the city

 Has a good infrastructural facility.

 Offers 50+ courses

 It has designed short-term courses

 Has a special practical room to experience real situation in shipping

 They use many information systems, which are inter-related with only one database for all systems.

 They design their own soft wares (designer- Mr. Sarvanan).

The various system used by the institute are

 Front office software
 Details and accounts software
 Transaction software
 Online examination software
 Library management software
 Back office software
 Registration
 Records receipts and payments
 Day-day transactions
 Deals with examinations
 Keeps track of books issued
 Certificates and course creation

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The On-line Examination System

Purpose of ES:

On-line Examination System is basically designed to ease the job of classroom examinations. The software engineer of the institute, Mr. Sarvanan, designed this package. All the systems in the institute are interconnected with only one database.

This system was designed a year ago and now the institute extensively uses it because it prevents waste of time. It manages the time factor effectively and efficiently.

Working:

The user i.e. the question paper setter can do the following modification with the papers through this software:

Modify topic:

This is the first stage in the software where the user can select, edit or delete the topic for which the questions are to be formed or selected. The institute offers around 50+ courses such as CHEMCO, CTF, EFA, FPFF, GASCO, MFA, etc. in various packages. So the modify topic option enables the user to select the topic among the various available courses. The user can also add any additional topic or edit or delete the existing one. So in this stage only the topic or the particular course for which the user wants to conduct the examination can be modified.

Modify question:

This is the second stage. Here the user needs to input the questions under the various topics created. After typing the question for the selected course or topic the software will show by a green light whether the question is appropriate for the course or the topic selected. If the green light is on agree box then the question is appropriate, on the other hand if it appears on the disagree box then the question is unsuitable. The user can also alter the questions that already exist.

Modify question paper:

This is the third phase where the user can create question paper for the various topics. Moreover when the question paper is formed it can be assigned to the candidates. The questions are randomly collected from the question bank.

Set up quiz:

This is the last stage. Here the user sets up the questions to test the intelligence of the students. The questions are selected in the same way as in the “Modify question paper” stage. This consists of an instructor room and a console room. The instructor room consists of all the information and when the software is accessed by the students it shows whether the instructor is ready or not. The console room on the other hand is under the control of the user. This is installed in only one computer. This will also show the minimum time taken by a student to answer a particular question.

Closing stages:

The questions or the question bank or the various topics or courses can be retrieved at any time by the user whenever it is needed.

Advantages of On-line Examination system:

 It is computerized and hence saves time.
 The software is interrelated.
 It is easy to handle.
 It minimizes operating expenses.
 The user need not be specialized to work with it.
 The work load is reduced.
 There is economy of operations.



Disadvantages of On-line Examination system:

 Virus malady
 Important documents may be retrieved by anyone who has an access to the software.
 Misuse of the system by students. For ex- a student by having access to another student’s password or register number can write the exam on his place.

Differences:

Before the introduction of the system:

Before the installation of this system all examination process was carried out manually. Setting of question papers for different courses and different packages of courses were done manually. This was a tedious job and the staff wasted a lot of time. Moreover the students also used to sit for hours to write the examination, which causes both physical and mental tiredness. It also used to consume large time in correcting the papers and publishing the results.

After the introduction of the system:

Subsequent to the introduction of the system it brought many rewards to the institution. The designing of the system has saved time of the staff members thereby making them concentrate on other gray areas of the institute. Even a person who has zero knowledge of the computers can use the system.
With the installation of the ES the entire examination process has been computerized. As a result the students get quick feedback about their performance. The manual work of the staff also has decreased to a large extent.

Conclusion:

The institution has been under the governance of (MMD) Mercantile Marine Department. The results are submitted to MMD after every exam. It has been applauded by MMD for imparting qualitative education to the students.

The institute of maritime training has many colourful feathers in its cap. It is one of the best institutions imparting maritime training. With the help of good infrastructural facilities it provides students with real-life experience.

Departmentation

Introduction

Organizations are formed when a group of individuals unite to accomplish a specific goal. They are responsible for creating a work environment that best utilizes resources such as people, tasks and technology. But, in order to meet this objective, they will need to create an organizational structure or design. Organizational structure and design include work specialization, departmentalization, chain of command, span of control, centralization and decentralization and common organizational designs. Departmentalization is discussed here.

Meaning of departmentation

Grouping of activities is an essential step in designing an organisational structure. Grouping of activities into departments or other homogeneous unit is known as departmentation. Departmentation or departmentalisation is the process of grouping tasks into jobs, the combining of jobs into effective work groups and the combining of groups into identifiable groups or departments.

Need and importance

The basic purpose of departmentation is to make the size of each departmental unit manageable and to secure advantages of specialization. It is necessary on the account of following reasons:

Specialisation:
Departmentation enables an organization to avail the benefits of specialisation. When every department looks after one major function, expertise is developed and efficiency of operation increases.

Expansion:
One manager can supervise and direct only a few subordinates. Grouping of activities and personnel into departments makes it possible or the enterprise to expand and grow. If there is no departmentation, the size of the organization will be restricted to the manager’s span of control

Autonomy:
Departmentation results in the division of enterprise into semi-autonomous units. In these units, every manager is given adequate freedom. The feeling of autonomy provides job satisfaction and motivation which in turn lead to higher efficiency of operations.

Fixation of responsibilities:
Departmentation enables each person to know the specific part he is to play in the total organization. It provides a basis for building up loyalty and commitment. The responsibility for results can be defined more precisely and an individual can be held accountable for performance.

Appraisal:
Appraisal of managerial performance becomes easier when specific tasks are assigned to specific personnel. The sources of information, the skills and competence required for total managerial decisions can be located.

Managerial development:
Departmentation facilitates communication, coordination and control. It simplifies the training and development of executives y providing them opportunities to take independent decisions and o exercise initiative.


Administrative control:
Departmentation is a means of dividing the large and complex oranisation into small and flexible administrative units. Grouping of activities and personnel into manageable units facilitates administrative control. Standards of performance for each and very department can be precisely determined. Excessive departmentation may result in several organisational problems such as erosion of the line of command, multiple accountability, dysfunctional conflicts and difficulty of coordination and control.

Types of departmentation:
The following patterns may be used for grouping activities into departments:



Functional departmentation:

Functional Departmentalization groups jobs by the functions that they perform. Hence each major or basic function is organized as a separate department. The basic or organic functions are the functions the performance of which is vital and essential to the survival of the organization. For example, key functions of a manufacturing company include production, purchasing, marketing, accounting, and personnel. The functions of a hospital include surgery, psychiatry, nursing, housekeeping, and billing.

If necessary, a major function may be divided into minor or sub-functions. A production department’s activities may classified into quality control, processing of materials and repairs and maintenance. The process of functional differentiation can continue as long as there exists a sound basis for further differentiation. It is the widely used basis for grouping activities and exists almost in every organization at some level.

DEPARTMENTATION BY FUNCTION
ADVANTAGES:
The main advantages of functional departmentation are as follows:

 It is the most logical, time proven and natural form of departmentation.
 It provides occupational specialisation which makes optimum utilisation of manpower.
 It ensures the performance of all activities necessary for achieving organizational objectives. It gives status to major function.
 It facilitates delegation of authority.
 It enables top management to exercise effective control over a limited number of functions.
 It eliminates costly duplication of effort.
 It simplifies training because managers have to be experts only in a narrow range of skills.

Disadvantages:
The following demerits can be drawn for functional departmentation-

 There is too much emphasis on specialisation.when each employee specializes only in a small part of the job, cannot develop a balanced attitude towards the job as a whole.
 There may be conflicts between departments as the responsibilities are interdependent and cannot always be clearly delineated.
 Functional departments may grow in size to justify their cost. Managers may try to build their functional empires
 The scope for management development is limited. Functional managers do not get training and experience for top management positions. Responsibility for results cannot be fixed on any one functional head.
 There may be difficulties in coordinating the activities of different departments. There may be inflexibility and complexity of operations.
Committees may be constituted to ensure coordination between functional departments. The functional basis is more useful to large organizations. Very often the functional basis is used at top level and some other basis is applied at lower levels.

PRODUCT DEPARTMENTATION 

Product Departmentalization jobs are grouped by product line in which each major product area is placed under the authority of a manager whom is responsible for all aspects of the product line. It is useful when product expansion and diversification, manufacturing and marketing characteristic of the product are of primary significance. It is generally employed when the product line is relatively complex and diverse requiring specialized knowledge and a great deal of capital is required for plant and equipment. A I company with diversified product line may have the following divisions-
DEPARTMENTATION BY PRODUCT


ADVANTAGES:
The following are its advantages-
 Product departmentation can reduce the problem of coordination between production and sales activities. All activities concerning a particular product line are integrated together.
 It focuses individual attention on each product line which facilitates product expansion and diversification
 It permits full use of specialised production facilities. Personal skills and specialised knowledge of product managers can be fully utilized.
 The performance of each product division and its contribution to overall results can be easily evaluated.
 Product managers can be held accountable for the profitability of each product
 As each product division is semi-autonomous and contains different functions, product departmentation provides an excellent training ground for top management positions.
 It is more flexible and adaptable to change.

DISADVANTAGES:
The disadvantages of product departmentation are as follows-
 There is duplication of physical facilities and functions. Each product division maintains its own specialised facilities and personnel due to which operating cost may be high.
 Advantages of centralization of certain activities like financing, accounting, industrial relations, etc; are not available.
 There may be underutilization of plant capacity when the demand for a particular product is not adequate.
 It creates the problem of effective control over product divisions by the top management.
 More persons with general management ability are required.
 Each product manager asserts his autonomy disregarding the interest of the organization.

The choice of product (or service) categories becomes an important component of product departmentation. Products can be grouped according to such diverse criteria as technology (e.g., electronic versus mechanical versus electromechanical), brand (e.g., Noxzema versus Cover Girl), product function (e.g., welding versus grinding equipment), size (e.g., low-volume versus high-volume pumps), and so forth. These distinctions often become manifest in "product-line" decisions, which, in turn, have organizational implications.

TERRITORIAL DEPARTMENTATION

Organizations that are spread over a wide area may find advantages in organizing along geographic lines so that all the activities performed in a region are managed together. Bank, insurance companies, transport companies, distribution agencies are examples of such enterprises. The activities are divided into zones, divisions and branches. It is obviously not possible for one functional manager to manage efficiently such widely separated activities this makes it necessary to appoint regional managers for different regions.
Departmentation by territory

Advantages:

 It helps in achieving the benefits of local operations. The local managers are more conversant with local customs, preferences, fashions, styles, etc. They can adapt and respond to the local demand situation with speed and accuracy. The enterprise can gain intimate knowledge of conditions in the local markets.
 It results in saving in freight, rents and labour costs. There are savings in time and money. Therefore, economies of localized operations are available.
 Every regional manager can specialize in the peculiar problems of his region.
 There is better coordination of activities in a locality through the setting up of regional division. It provides for effective span of control.
 It facilitates the expansion of business to various regions.
 It provides opportunities to train managers as they look after the complete operations of a unit. Each regional manager can be given adequate autonomy.

Disadvantages:

 Due to geographical distance there is problem of communication.
 Geographical departments require more managers with general managerial abilities which may not always be available.
 There may be friction between regional managers.
 All activities of a firm may not be amenable to territorial specialisation.
 Coordination and control of different branches from the head office becomes less effective.
 There is duplication of physical facilities due to which the cost of operation may be high. There is multiplication of personnel, accounting and other services at regional level.

CUSTOMER DEPARTMENTATION

An organization may find it advantageous to organize according to the types of customers it serves. For example, a distribution company that sells to consumers, government clients, large businesses, and small businesses may decide to base its primary divisions on these different markets. Its personnel can then become proficient in meeting the needs of these different customers. This figure depicts an organization grouped by customers and markets.
Advantages:
 Special attention can be given to the particular tastes and preferences of each class of customers. Customers’ satisfaction enhances the goodwill and sales of the enterprise and loyalty of customers.
 The benefits of specialisation can be derived
 The enterprise gains intimate knowledge of the needs of each category of customers.

Disadvantages:
 As such departmentation is applied only to sales function; there may be difficulties in coordinating the activities of different functions. There is constant pressure from customer department for special treatment.
 There may be under-utilisation of facilities and manpower, particularly during period of low demand.
 Managers of customer departments may put pressure for special facilities and benefits.
 It may lead to duplication of activities and heavy overheads.

PROCESS OR EQUIPMENT DEPARTMENTATION 

Here activities are grouped on the basis of production process or equipment involved. For example: The Plant Superintendent would work in conjunction with the managers of the Materials Department, Assembling Department, Finishing Department and the Inspection Department.

DEPARTMENTATION BY PROCESS

Advantages:
 There is clear-cut technical division of work.
 This ensures specialisation and facilitates training of junior executives.
 It is possible to appoint persons with special education and experience for each process.
 Location of similar type of machines in one place result in economies in costs of repairs and maintenance.

Disadvantages:
 There may be difficulty in co-ordinary different process department. Conflicts among managers of different processes may arise.
 It cannot be used where manufacturing does not involve distinct process.
 It is suitable only for special and composite type of plants.

TIME DEPARTMENTATION:

Another way to departmentalize is to group activities according to the period of time during which work is performed. Many organizations are engaged in round-the-clock operations and departmentalize on the basis of time by having work shifts (day, afternoon, night shift).

Shift work can contribute to numerous other employee problems and concerns, including personal safety, sleep deprivation, child care, and work/family conflicts. Night-shift workers often perceive that they are viewed as “second-class citizens” who have limited access to the training and development opportunities afforded to day-shift personnel.

COMPOSITE OR COMBINED DEPARTMENTATION

In order to achieve an effective structure, a supervisor may have to apply several types of departmentation at the same time. This is referred to as “mixed” departmentation. In practice, many organizations have a composite departmental structure involving functional departmentation, geographic departmentation, and other forms. All of these alternatives may be available to supervisors to facilitate the grouping of activities in their departments


CHOOSING THE BASIS OF DEPARTMENTATION

Management must be very careful in choosing the basis of departmentation because once a pattern is chosen it is very difficult and costly to switch over to another pattern. The following factors should be kept in view while selecting a suitable basis of departmentation.
 Specialisation:- The activities of an organization should be grouped in such a way that it leads to Specialisation of work. This helps to improve efficiency and economy of operations and enables people to become experts.

 Coordination in the performance of different activities is necessary so that they contribute maximum towards the organizational goals.

 Control:- The departmentation should be such that it facilitates measurement of performance and timely corrective action. Effective control helps to achieve organizational goals efficiently and economically.

 Cost:- The pattern and the number of departments should be so decided that maximum possible economy is achieved in the utilization of physical facilities and personnel.

 Special attention:- The various activities should be given adequate attention so that each necessary activity is performed and there is no unnecessary duplication of activities.

 Local Conditions:- Should be adequately considered in a scheme of decentralization. Departmentation should be adjusted according to available resources.

 Human consideration:- the existence of informal groups, cultural patterns, value system, etc. should be given due consideration. Attention to human factors will make departmentation more efficient and effective.

Managerial terms

Key managerial terms

Abandonment- Controlling party giving up rights to property voluntarily.

A 1 line manager – First line managers direct the work of non-management employees.

Abnormal returns -The component of the return that is not due to systematic influences (market-wide influences)

Acceptance criteria-The criteria a product must meet to successfully complete a test phase or meet delivery requirements.

Activity Measures-These measures typically track the actions or behaviors an organization performs
Additional hedge-A protection against borrower fallout risk in the mortgage pipeline.

Amortization-The repayment of a loan by installments.

Article -The Prime system or equipment being acquired under a contract

Authentication-The procedure (essentially approval) used by the approval authority in verifying that specification content is acceptable

Benchmarking-The comparison of similar processes across organizations and industries

Brokered market-A market in which an intermediary offers search services to buyers and sellers.

Butterfly shift- A non parallel shift in the yield curve involving the height of the curve.

Certification- A process by which a contractor provides evidence to the acquirer that a product meets specified requirements.

Critical Success Factors (CSF) - These are activities that must be done well in order for the organization to succeed

Contract- A mutually binding legal relationship obligating the seller to furnish the supplies or services (including construction) and the buyer to pay for them.

Covers- .A product "covers" a given set of items if every item in the set has been dealt with in the specific product.
Database. A collection of related data stored in one or more computerized files
Decision support systems – special purpose applications that exist to support the resolution of particular problems.
Developer- An organization that develops products for itself or another organization.
Disenchantment – followed in the ranks of managers and professionals.

Disillusionment – followed in the ranks of managers and professionals.

Disappointment – followed in the ranks of managers and professionals.
Model – a simplified representation of the key properties of an object, event or relationship, can be verbal, physical or mathematical.

Distribution statement- A statement used in marking a technical document to denote the extent of its availability for distribution

Differential rate system – F.W Taylor compensation system involving the payment of higher wages to more efficient workers.

Direct action elements- Elements of the environment that directly influence organizations activities.

Documented procedure- A written description of a course of action to be taken to perform a given task.

Domain-The part of the external world, including users and inmates of the system that effects and is affected by the system.

Evaluation-The process of determining whether an item or activity meets specified criteria.
Executive support systems – systems employed by very senior managers to keep abreast of the organization in broad.

Flows– Components such as information, material and energy that enter and leave a system.

Goals - Synonymous with Priorities and Objectives.

Hot money- Money that moves across country borders in response to interest rate differences and that moves away when the interest rate differential disappears.

Hybrid- A package of two or more different kinds of risk management instruments that are usually interactive.
Initiatives- The specific programs, activities, projects or actions an organization undertakes to meet targets.

Input Measures-These measures track resources used to drive organizational results

Lagging Indicators- Performance measures that represent the consequences of actions previously taken

Leading Indicators- These measures are considered the “drivers” of lagging indicators

Mission Statement- A mission statement defines the core purpose of the organization

Management Information Systems – facilitates the management of those day to day activities

Outcome Measures- These measures track the benefit received by the stakeholder as a result of the organizations operations

Oligopoly - A Market characterized by a small number of large buyers who control all purchases and therefore the market price of a good or service.

Overwriting - A speculative options strategy that involves selling call or put options on stocks that are believed to be overpriced or under priced; the options are expected not to be exercised.

Owner's equity - Paid-in capital plus donated capital plus retained earnings less liabilities.

Office automatic systems – facilitate office activities such as the preparation and communication of correspondence.

Reengineering – this occurs when an organization conducts a significant reassessment of what is all about.

Short straddle- A straddle involves both purchase and sale. In short straddle one put and one call are sold.

Short-term capital gain- A profit on the sale of a security or mutual fund share that has been held for one year or less.

Speculative motive- A desire to hold cash in order to be poised to exploit any attractive investment opportunity requiring a cash expenditure that might arise.

Spread order- An order listing the series of options that the customer wants to buy and sell and the desired spread between the premiums paid and received for the options.

Stagnation- A period of slow economic growth, or, in securities trading, a period of inactive trading.

Stakeholders- All parties that have an interest, financial or otherwise, in a firm-stockholders, creditors, bondholders, employees, customers, management, the community, and the government.

Strategy- Describes the differentiating activities an organization pursues to gain competitive advantage

Transaction – processing system –day to day activities of the organization

Theoretical value- Mathematically determined value of a derivative instrument as dictated by a pricing model such as the Black-Scholes model.

Theta - The ratio of the change in an option price to the decrease in time to expiration.

Trenches- One of several related securities offered at the same time.

Volume discount- A reduction in price based on the purchase of a large quantity.

Voluntary accumulation plan- Arrangement allowing shareholders of a mutual fund to purchase shares over a period of time on a regular basis

Voluntary bankruptcy- The legal proceeding that follows a petition of bankruptcy.

Voluntary liquidation- Liquidation proceedings that are supported by a company's shareholders.

Voluntary plan- A pension plan supported partially by the employee by pension contributions deducted from each paycheck.

Volatility risk- The risk in the value of options portfolios due to the unpredictable changes in the volatility of the underlying asset.

Voting Instruction Card - The voting card sent to participants in an employee plan giving the trustee of the plan the authority to vote the shares as indicated on a proxy card.

Volume - This is the daily number of shares of a security that change hands between a buyer and a seller.

Voting certificate- Certificates issued by a voting trust to stockholders in exchange for their common stock, which represent all the rights of common stock except voting rights.

Zone of indifference –inclinations conditioning individuals to accept orders that fall within a familiar range of responsibility or activity.