The system involves data collection, its processing and the methods of distribution to various users. The AIS is normally platforms that are highly secured, consisting of numerous preventative measures that are taken against external sources, hackers and viruses. Today, the threat of cybersecurity is imminent, thereby increasing the necessity for organizations to store data electronically. The AIS provides vital accounting and financial reports that aid in decision making amongst tax authorities, investors and creditors (Touvila, 2019). Thus, in modern-day business, the AIS is playing a crucial role, especially in making more informed decisions by management due to the manipulation capabilities of the available data.
Improper Assumptions by Corporate Leaders
In the modern business world, the AIS has become a critical tool due to its numerous benefits that normally outnumber the underlying costs. The ability of AIS to provide accurate and timely information to the management has made it easy for them to govern key functions involving cash transactions and various receivables and payables. Due to the large transactions in various accounting departments, it is of utmost importance to embrace an effective AIS. However, it is assumed that most of the organizations have a computerized system for AIS despite having numerous components such as data, security measures, people and information technology.
Due to the combination of numerous aspects within the AIS, various unwarranted situations normally arise among different corporate leaders. Several improper assumptions directly related to the AIS that occur in the management. However, both managers and leaders must have the proper knowledge to avoid various mistakes. According to Russell Ackoff, there are several assumptions regarding information systems (Ackoff, 1967). Although they were formulated long ago, some have relevance in modern business such as improving communication plays a vital role in improving the overall performance of an organization.
Assumption 1: Management requires more Information
In business, most of the information systems are usually designed to provide more information to the managers. Supplying the relevant data and the elimination of information which is less needed is critical. However, most of the leaders tend to create more emphasis on retrieval, storage and generating data, thereby ending up constructing more data banks to facilitate coding and updating of files.
Assumption 2: Managers Know What Information They Need
Most managers tend to assume that they are capable of understanding the information they require to make certain decisions. However, different conceptions are highly likely to be deficient, thereby influencing the outcome. It is critical to assess how well various corporate leaders are capable of utilizing the required information because their final decisions are directly related to the performance of a particular business.
Assumption 3: The Ability to improve Decision Making is Determined by Giving Managers the Information They Require
It is normally assumed that managers and leaders have no problem while using the information provided effectively. However, numerous possibilities may arise in different management challenges, thereby affecting the judgement of one individual. Therefore, even managers may endure difficulties in effectively solving various problems which in turn may affect their final decisions.
Assumption 4: More Communication determines better Performance
An effective management information system (MIS) helps in providing various leaders with current information regarding the progress of various departments. The assumption is that the presence of improved interdepartmental communication helps in the coordination of different operations, thereby promoting the overall performance within an organization. Cooperation among various departments is vital for the success of various business operations.
Assumption 5: A Manager Should Only Understand How to Use an Information System
MIS designers need to make their systems easily understood by most managers to improve their abilities in controlling and operating an organization. The assumption has left most managers being unable to evaluate a particular MIS effectively. Thus, they end up delegating much of an organization control to system operators and designers.
Negative Impacts of the Assumptions
Reduced Integrity on Financial Reporting
Assuming that managers know the information, they need to make key decisions that may harm making appropriate judgements. Understanding only how to use the MIS amongst managers reduces their abilities to effectively controlling the entire system. Integrity and honesty are critical, especially in accounting, to allow various investors to trust and embrace the information regarding a particular organization.
Improper Reflection of an Organization’s True Assets
Presence of assumptions has been widely known as a major source of inaccuracy, especially in the data entry, thereby creating misleading financial statements. Having a true reflection concerning the assets of a company is key towards providing insight to various investors on the liquidity of an organization. Thus, any inaccuracy may limit investments made to a specific business.
Loss of Money and Time
Companies tend to invest a lot of money towards the development of an effective AIS to simplify most of their operations. Different financial documents are used in various stages, especially operational and planning. However, the assumption of supplying only the relevant information may force a company to invest huge sums of capital on aspects of generating and storing data.
Ways of Improving Organizational Performance
Globally, most of the organizations are tirelessly working towards improving their performance by embracing numerous policies. It involves ensuring that the resources of a particular organization are optimally used especially towards the pursuit of the goals and objectives. Due to high market competition, the success and survival of an organization are dependent on its performance (Richard, Devinney, Yip, & Johnson, 2009). Different leaders and managers adopt a variety of ways with the main aim of boosting their overall performance.
Employee Involvement
Enhancing employee involvement in critical matters such as decision making allows them to bring more innovative ideas and expertise. Encouraging direct participation, especially amongst the employees alongside the leadership, is vital for an organization to achieve its goal and fulfil its mission. In the modern-day business, engaging the employees has become a priority among most companies to ensure they remain relevant and more competitive. Taking feedback from employees seriously is critical towards motivating them, thereby improving their performance and increases the chances of retaining their talents.
Customer Focus
Due to the increased competitiveness in modern businesses, it is critical for managers and corporate leaders to embrace key strategies that are customer focused on ensuring they come back again. Most organizations have focused more on meeting the specific needs and requirements of its customers. A strong customer focus is usually a major contributing factor to the success of an organization. Making an extra effort to understand the needs of customers and helping them is closely linked to enhancing organizational performance.
Benchmarks
Benchmarking is vital towards allowing the organization to set various goals and measuring productivity based on certain practices. The strategy helps in comparing performance on different products and processes based on best performances from other companies. Strategic benchmarking is critical towards improving the organizational performance through embracing different processes, initiatives and capabilities that have proved successful. It’s critical to select an organization that is not a competitor to ensure that the management may evaluate key aspects.
Leadership
An organization leader tends to have a direct effect on the relationship among workers, thereby affecting its success. Leadership helps in shaping a company’s strategies, modes of execution to ensure they are properly achieved. Leaders play a critical role in promoting employee motivation and instilling positive values and culture in work. Thus, the leadership style adopted by a particular manager has a great influence on the overall performance of a particular organization. For example, transformational leadership has proven on improving the skills and motivation of employees, thereby increasing their performance.
Level of Security Needed
Automated business systems entail key controls and measures that are being put in place towards ensuring the integrity and confidentiality of information. In the recent past, there have been numerous cases of companies giving out details concerning their customers without the consent of different individuals, particularly hackers. Thus, an organization must create systems that guarantee the safety of confidential information. Having a certain level of security regarding personal information may play a critical role in reducing the violation of personal rights.
Automation has become a major driving factor for numerous changes, especially in modern industries. Moreover, the automation of different processes has revitalized the modes of working, planning and ways of engaging with others. As a result, security breaches have become increasingly common due to the high vulnerability of the systems. Ensuring integrity is a major requirement that can be achieved by creating policies that help in preventing fraud.
In conclusion, A high level of security plays a vital role in ensuring the threats posed by the automation are minimal. Having a low-security level makes an organization more vulnerable to numerous potential hackers who take advantage of the weak system. Exposure to various threats may bring numerous damages and losses that usually hurt the company. Therefore, an organization needs to embrace a high level of security to safeguard its data and information.