Management information system

 Definition
 Objectives & Concepts of MIS
 Purpose & Characteristics of MIS
 Components of MIS
 Functions of MIS
 Role of MIS
 Process of MIS
 Development of MIS within the Organization
 Systematic Approach in Planning, Organizing & Controlling MIS
 Different Phases
 Advantages & Disadvantages of MIS
 Applications of MIS
 Why MIS Fails?

 A management information system (MIS) is a series or group of processes that process,
analyze, and display data to be used in decision-making. This system is a planning system
that is part of the company’s internal control and consists of documents, human resources,
technology, and management accounting processes.
 In simple words, it is defined as a system that aids management in making, carrying out and
controlling decisions.

The primary goal of this system is to collect and organize all data from various
levels of business, summaries and then facilitate decision making, and improve
quality to increase the company’s productivity and profitability.

 Management: Management covers the planning, control and administration of the operations
of a concern.
 Information: Information, in MIS, means the processed data that helps the management in
planning, controlling and operations.
 System: Data is processed into information with the help of a system.

Purpose & Characteristics of MIS
Purpose of MIS
 MIS helps the management at various levels and it is mean of communication where data are
collected, processed, stored and retrieved for making decisions regarding planning, operation
and control of an organization.
Characteristics of MIS
 Management-Oriented
 Management-Directed
 Integrated System
 Avoid Redundancy

Characteristics of MIS (Cont.)
 Common Data Flow
 Heavy Planning Element
 Subsystem Concept
 Common Database
 Flexibility
 Computerization

Components of MIS:
Management Information System refers to the data, hardware, and the computer programs that
are used to develop information for managerial use.
 People: It is the only living component of MIS which operates, controls the other components
of MIS.
 Procedure: Procedure explain the people how to operate the computer hardware.
 Data: Data provide interface between the user and computer.
 Hardware: It is the machine part of the computer system which executes the instructions in
programs.
 Software: A program is a set of instructions written in logical order for performing a specific
task related to information production.

Components of MIS (Cont.)
 Management Information System refers to the data, hardware, and the computer programs
that are used to develop information for managerial use.

Functions of MIS:
 It is used to collect the data and present the information to the managers. MIS is the
combination of computer and procedures for providing information that manager's use in
making decision.
1. Collect Data – Data can be obtained from sources within organization and outside world.
2. Store & Process Data – After creation of the data, a database must be stored and process
in the form useful to managers data is generally stored to CD ROM or hard disk.
3. Present Information to Managers – After collection, storing and processing of data, the
nextstep is to present information to the managers.

Role of MIS:
MIS ensure that appropriate and relevant data is collected from various sources, processed
and is sent further to the needy destination.
 It fulfills the need of individual, workgroup and management.
 MIS satisfies the diverse need of various systems like query, Analysis, Modeling, DS.
 MIS helps in strategic planning, management control, operational control and transaction
processing level.
 MIS play important role in information generation, communication, problem identification
anddecision making administration.
 With good MIS support marketing, finance, production, and personal functions increases
efficiently.

Role of MIS (Cont.)
 MIS helps in streamlining of the operations.
 MIS creates structured database and therefore saves the time.
 MIS bring clarity in communication and understanding this help in bringing high degree
ofprofessionalism.
 MIS helps in systemization of business operation through tools and techniques of the
computer,which makes task simpler, accurate and faster.

Process of MIS:
 The process of MIS starts by knowing MIS objectives. The objectives of MIS should be
compatiblewith the company's objectives.
 Management comprises process or activities they are as follows:-
• Recognition of a problem and an opportunity
• Define problem or opportunity
• Develop alternative course of action
• Decision
• Implementation of plan
• Control performance against plan
 For its smooth functioning and achieving of its predetermined goals through optimal
utilization ofits resources like men, money, material and machines.

Development of MIS within the Organization:
 If MIS is to assist managerial decision making at all level of company then low organization
level information systems must be integrated in MIS.
 Next stage is planning & control. Next stage of MIS development is integration of subsystems.
Management plans to integrate existing sub system to unified system. The management
focuses attention to database administration.
 Next stage is MIS maturity. This is to state when MIS department is agreed up to plan future
needs for organization.

System Approach In Planning, Organizing & Controlling MIS
1. System Approach in Planning – The important function of management is planning. Planning
means deciding in advance, what has to be done, who has to do it, when is to be done and how it
is to be done. The planning process consist of two steps –
 Developing the strategy.
 Formulating the steps, timing and cost, required to achieve the strategy.
2. System Approach in Organizing – Organizing is important to manager because it helps in effective
group action. It also helps in maintaining the people to work together. It consist of following points -
 The formal organization system as described in chart policies and procedure.
 The informal organizing.
 The individual as a system

(Cont.)
3. System Approach in Controlling – Controlling is important because it is needed to achieve the
desire result. The most common process consist of three steps:
 Setting standard for performance – It involves what level of performance we need. These
criteria can be quantitative or qualitative.
 Measuring performance against this standard – Once standard have been established, it is
necessary to measure performance against standards.
 Deviation Control – We know that for measuring the deviation, first comparison ofstandard
with actual performance is made.

Different Phases:
 The different phases of organizing are:
1. Develop a technical organization
2. Start with total company objectives and develop a hierarchy of systems
required.
3. Involve specialists in developing a team, matrix or a system.

Advantages of MIS
1. Improving Data Accuracy: Accurate data is needed in a company because it is related to strategic
decisions. MIS is a tool that provides accurate data needed by the company.
2. Facilitate Coordination: This system also provides information services that you can use for planning,
monitoring and administrative control. From the resulting information, data can be used by other
departments or departments in need.
3. Improving the Quality of Human Resources: When information data is available accurately and quickly,
this will affect the performance of the company’s human resources.
4. Reduce Operational Costs: If MIS has worked for your company, this system will help minimize human
error. With a minimal number of errors, the productivity of existing human resources will also increase.
Then at the same time, conditions like this certainly reduce the company’s operational cost’s.

Limitations of MIS in Business
1. Piracy and cybercrime are typical examples of technological crimes.
2. Individual liberty and competence do not grow.
3. Due to a lack of progress in IT, it does not strengthen the economy.
4. Media offers will present a limited range of interests and tastes.
5. The formation of community ties and relationships will be hampered.
6. An agency’s operations become inefficient.

Application of MIS in Business
1. Enterprise Resource Planning (ERP): ERP is generally used in management and in integrated monitoring
between business units.
2. Supply Chain Management (SCM): This system is beneficial for management because it can help to
integrate material supply management from suppliers, manufacturers, retailers to final consumers.
3. Transaction Processing System (TPS): TPS is a management information valuable system for processing
large amounts of data or multiple and routine transactions. This program is widely used in payroll and
inventory management.
4. Office Automation System (OAS): This application helps facilitate communication between departments
within a company by integrating computer servers for each company user. For example, the use of email
for various activities in the office every day.
5. Decision Support System (DSS): This system helps executives make decisions by observing the business
environment. An example of this single management information system is links electronic.

MIS – A Support to the Management
• The management process is executed through a variety of decisions taken at each step of
planning, organizing, staffing, directing coordinating and control.
• If the management is able to spell out the decisions required to be taken, the MIS can be
designed suitably.
• The decisions required to be taken in these steps are tabulated in Table: Decisions in
Management in the next slide.

MIS – A Support to the Management (Cont.)
Steps in
Management
Decision
1. Planning A selection from various alternatives - strategies, resources, methods, etc.
2. Organization A selection of a combination out of several combinations of the goals, people,
resources, method and authority.
3. Staffing Providing a proper manpower complement.
4. Directing Choosing a method from the various methods of directing the efforts in the
organization.
5. Coordinating Choice of the tools and the techniques for coordinating the efforts for optimum
results.
6. Controlling A selection of the exceptional conditions and the decision guidelines

MIS – A Support to the Management (Cont.)
• The objective of the MIS is to provide information for a decision support in the process
of management.
• It should help in such a way that the business goals are achieved in the most efficient
manner.
• Since the decision making is not restricted to a particular level, the MIS is expected to
support all the levels of the management in conducting the business operations.
• Unless the MIS becomes a management aid, it is not useful to the organization.

Why MIS Fails?
MIS failures can be expensive and bring bad publicity to all parties. They can arise dueto:
 Inadequate analysis-
 Lack of management involved in the design
 Emphasis on the computer system
 Concentration on low-level data processing
 Lack of management knowledge of ICT systems and capabilities
 Lack of teamwork
 Lack of professional standards

Management information system

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