MANAGEMENT INFORMATION SYSTEM ( MIS)

Management Information System (MIS) is a planned system of collecting, storing, and disseminating data in the form of information needed to carry out the functions of management.A Management Information System is an information system that evaluates, analyzes, and processes an organization's data to produce meaningful and useful information based on which the management can take right decisions to ensure future growth of the organization.

A Management Information System is an integrated user-machine system, for providing information, to support the operations, management, analysis & decision-making functions in an organization.

The System utilizes computer hardware & software, manual procedures, models for analysis, planning, control & decision making and a database.

MIS provides information to the users in the form of reports and output from simulations by mathematical models. The report and model output can be provided in a tabular or graphic form.

Information Vs DataData can be described as unprocessed facts and

figures. Plain collected data as raw facts cannot help in decision-making. However, data is the raw material that is organized, structured, and interpreted to create useful information systems.

Data is defined as 'groups of non-random symbols in the form of text, images, voice representing quantities, action and objects'. Information is interpreted data; created from organized, structured, and processed data in a particular context.

According to Davis and Olson: "Information is a data that has been processed into a form that is meaningful to recipient and is of real or perceived value in the current or the prospective action or decision of recipient."

MIS Definition

The MIS has more than one definition, some of which are give below. 1. The MIS is defined as a system which provides information support for decision making in the organization. 2. The MIS is defined as an integrated system of man and machine for providing the information to support the operations, the management and the decision making function in the organization. 3. The MIS is defined as a system based on the database of the organization evolved for the purpose of providing information to the people in the organization. 4. The MIS is defined as a Computer based Information System

The MIS is a system to support the decision making function in the organization. The difference lies in defining the elements of the MIS. However, in today’s world MIS a computerized business processing system generating information for the people in the organization to meet the information needs decision making to achieve the corporate objective of the organization.

The management information system uses computers and communication technology to deal with

• Handling of a voluminous data. •Confirmation of the validity of data and

transaction. • Complex processing of data and multidimensional

analysis. •Quick search and retrieval. •Mass storage. • Communication of the information system to the

user on time. •Fulfilling the changing needs of the information.

The role of the MIS in an organization can be compared to the role of heart in the body. The MIS satisfies the diverse needs through a variety of systems such as Query Systems, Analysis Systems, Modeling Systems and Decision Support Systems. The MIS helps in Strategic Planning, Management Control, Operational Control and Transaction Processing.

The MIS helps the clerical personnel in the transaction processing and answers their queries on the data pertaining to the transaction, the status of a particular record and references on a variety of documents.

The MIS helps the junior management personnel by providing the operational data for planning, scheduling and control, and helps them further in decision making at the operations level to correct an out of control situation.

The MIS helps the middle management in short them planning, target setting and controlling the business functions. It is supported by the use of the management tools of planning and control.

The MIS helps the top management in goal setting, strategic planning and evolving the business plans and their implementation.

The MIS plays the role of information generation, communication, problem identification and helps in the process of decision making. The MIS, therefore, plays a vital role in the management, administration and operations of an organization

IMPACT OF IMS1. The impact of MIS on the functions is in its

management. With a good support, the management of marketing, finance, production and personnel become more efficient. A disciplined information reporting system creates a structured data and a knowledge base for all the people in the organization.

2. The MIS creates another impact in the organization which relates to the understanding of the business itself. The MIS calls for a systemization of the business operation for an affective system design.

3. A well designed system with a focus on the manager makes an impact on the managerial efficiency

Five main uses of information by businesses and other organizations:

• Planning - At the planning stage, information is the most important ingredient in decision making. Information at planning stage includes that of business resources, assets, liabilities, plants and machineries, properties, suppliers, customers, competitors, market and market dynamics, fiscal policy changes of the Government, emerging technologies, etc.

• Recording - Business processing these days involves recording information about each transaction or event. This information is collected, stored, and updated regularly at the operational level.

• Controlling - A business need to set up an information filter, so that only filtered data is presented to the middle and top management. This ensures efficiency at the operational level and effectiveness at the tactical and strategic level.

• Measuring - A business measures its performance metrics by collecting and analyzing sales data, cost of manufacturing, and profit earned.

• Decision-making - MIS is primarily concerned with managerial decision making, theory of organizational behavior, and underlying human behavior in organizational context. Decision-making information includes the socio-economic impact of competition, globalization, democratization, and the effects of all these factors on an organizational structure.

Management information systems provide information to support management decision making, with the following goals:

Pre-specified and preplanned reporting to managers.

Interactive and ad-hoc support for decision making.

Critical information for top management.

MIS is of vital importance to any organization, because:

It emphasizes on the management decision making, not only processing of data generated by business operations.

It emphasizes on the systems framework that should be used for organizing information systems applications.

Objectives of MIS • Capturing Data: Capturing contextual data, or

operational information that will contribute in decision making from various internal and external sources of organization.

• Processing Data: The captured data is processed into information needed for planning, organizing, coordinating, directing and controlling functionalities at strategic, tactical and operational level.

• Information Storage: Information or processed data need to be stored for future use.

• Information Retrieval: The system should be able to retrieve this information from the storage as and when required by various users.

• Information Propagation: Information or the finished product of the MIS should be circulated to its users periodically using the organizational network.

Characteristics of MIS • It should be based on a long-term planning. • It should provide a holistic view of the dynamics and

the structure of the organization.• It should work as a complete and comprehensive

system covering all interconnecting sub-systems within the organization.

• It should be planned in a top-down way, as the decision makers or the management should actively take part and provide clear direction at the development stage of the MIS.

• It should be based on need of strategic, operational and tactical information of managers of an organization.

• It should also take care of exceptional situations by reporting such situations.

• It should be able to make forecasts and estimates, and generate advanced information, thus providing a competitive advantage. Decision makers can take actions on the basis of such predictions.

• It should create linkage between all sub-systems within the organization, so that the decision makers can take the right decision based on an integrated view.

• It should allow easy flow of information through various sub-systems, thus avoiding redundancy and duplicity of data. It should simplify the operations with as much practicability as possible.

• Although the MIS is an integrated, complete system, it should be made in such a flexible way that it could be easily split into smaller sub-systems as and when required.

• A central database is the backbone of a well-built MIS.

Characteristics of Computerized MIS• It should be able to process data accurately and

with high speed, using various techniques like operations research, simulation, heuristics, etc.

• It should be able to collect, organize, manipulate, and update large amount of raw data of both related and unrelated nature, coming from various internal and external sources at different periods of time.

• It should provide real time information on ongoing events without any delay.

• It should support various output formats and follow latest rules and regulations in practice.

• It should provide organized and relevant information for all levels of management: strategic, operational, and tactical.

• It should aim at extreme flexibility in data storage and retrieval.

MIS MODEL

General model of MIS plan

i] The corporate information focuses on the current operations and the environment position

ii] Corporate philosophy defines the policy, guidelines which form the work culture in the organization.

iii] Corporate mission, goals, objectives defines the long term aspects of the system .

iv] Business risk and rewards defines the trade of between these factors to give the clear quantitative factors.

v] Business strategy and policy focuses on the key areas of information system.

vi] Information needs focuses on the critical information as well as how do we achieve the goals and the objectives in the system.

vii] Architecture of plan focuses on the tools for the achievement. viii] System development schedule focuses on the details of

system and sub-systems with their linkages charted against the timescale.

ix] Organization and execution of the plan focuses on the individual toll in the system.

x] Budget focus on its cost investment schedule.

MIS and Decision Making

Concept Of MIS

Information requirements for MIS

1. Assessing information needs2. Levels of information requirements

-Organization level-Application Level-User level

3. Strategies for determining information requirements

Types of MIS• Databank information systems refer to creation of a

database by classifying and storing data which might be potentially useful to the decision maker.

• Predictive information systems provide source and data along with predictions and inferences.

• Decision making information systems provide expert advice to the decision maker either in the form of a single recommended course of action or as criteria for choice, given the value system prevailing in the organization.

• Decision taking information systems integrate predictive information and decision making systems.

Process of MIS1. First establish management information

needs and formulate broad systems objectives so as to delineate important decision areas.

2. Develop a general description of a possible MIS as a coarse design.

3. Once the information units needed have been determined and a systems design developed, decide how information will be collected.

4. Develop a network showing information flows.

5. Test the system until it meets the operational requirements, considering the specifications stipulated for performance and the specified organizational constraints.

6. Recheck that all the critical data pertaining to various subsystems and for the organization as a whole are fully captured. Ensure that information is generated in a timely manner.

7. Monitor actual implementation of the MIS and its functioning from time to time.

Methodology for implementing MIS

1. Understand the organization2. Analyze the information requirements of the

organization3. Plan overall strategy4. Review5. Preliminary analysis6. Feasibility assessment7. Detailed fact finding8. Analysis9. Design10. Development11. Cutover

12. Obtain conceptual schema13. Recruit database administrator14. Obtain logical schema15. Create data dictionary16. Obtain physical schema17. Create database18. Modify data dictionary19. Develop sub-schemas20. Modify database21. Amend database

Criteria for MIS• Relevance:- Information should be relevant to the

individual decision makers at their level of management.

• Management by exception:- Managers should get precise information pertaining to factors critical to their decision making.

• Accuracy:- The database from which information is extracted should be uptodate, contextually relevant and validated.

• Timeliness:- The information should be provided at the time required.

• Adaptability:- The information system should have an inbuilt capability for redesign so that it can suitably adapt to environmental changes and changing information requirements.

Strategies for determining MIS design

• Organization-chart approach:- Using this approach, the MIS is designed based on the traditional functional areas, such as finance, administration, production, R&D and extension.

• Integrate-later approach:- Largely a laissez faire approach, it does not conform to any specified formats as part of an overall design.

• Data-collection approach:- This approach involves collection of all data which might be relevant to MIS design. The collected data are then classified.

• Database approach:- A large and detailed database is amassed, stored and maintained.

• Top-down approach:- The top-down approach involves defining the information needs for successive layers of management.

• Total-system approach In this approach the interrelationships of the basic information are defined prior to implementation.

PARAMETERS OF MANAGEMENT OF QUALITY IN MIS Complete data of all the transaction achieves

the integrity of data with respect to the period. Valid transaction input data ensures the validity

of data and in turn assumes the valid information.

Accuracy & precision assures that results are accurate & precisely correct based on rules.

Relevance to user is appropriate in the quality of decision making.

If the information is received late it becomes useless with the view of decision making.

Information should be complete & meaningful. It should be represented in proper format with references.

MIS- THE FACTORS CONTRIBUTING TO SUCCESS:

i] MIS should have the adequate development resource for organisation.

ii] An appropriate information processing technology requires meeting the data processing & analysis is need of the users.

iii] MIS should be defined & designed in terms of user‘s requirement and the operational feasibility is ensured.

iv] MIS should be the open system in nature to modify the information needs.

v] MIS should focus on the result and the goals and highlight the factors & reasons for non-achievement.

vi] MIS should collect the complete information to avoid the noise in the information.

vii] MIS must consider the factors in the management process according to the human behaviour.

viii] MIS should be easy to operate & user friendly. ix] MIS should concentrate on all the level of information

needs.

MIS-FACTORS CONTRIBUTING TO THE FAILURE: i] MIS is conceived as a data processing not as

information processing. ii] MIS doesn‘t provide the managerial information. iii] Underestimating the complexity in business

system and not recognizing. iv] Adequate attentions not given to the quality

control aspects of inputs , process and output. v] MIS is developed without streamlining the

transaction processing in the organization. vi] MIS does not meet certain critical factors for

data processing. vii] Administrative in discipline, wrong coding &

deviation in system specification also cause failure.

viii] MIS does not give the perfect information.

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