19 MIS With SoneriBank Example

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APPLICABILTY OF ADVANCE MIS IN BUSINESS ENVIRONMENT

Introduction:
The need for management information:
Manger has always need information to help to them manage such information
can be gathers through the Formal reporting system are through informal means
the so called Management by Walking Around formalized management
information system were available to manger even before modern computers was
invented . Before few years the great trading companies carved out their own
trading empires across the glob. Again with out a computer insight. while there
advent of computers made it easier to process large amount of performance and
financial information to help the mange companies , business management ,
marketing management did not begging 1941 when the first computers was
invented .
MIS (Management Information System)
Applicability of MIS in business environment is based on the premise that
information systems knowledge is essential for creating competitive firm managing
global corporations, adding value and providing useful products and services to
customers.
By 1960 the concept and usage of computer based management information system
had began to take hold. Today the use of computers for gathering and disseminating
management information is common place even if it is still supplement by traditional
Means. Because computers make so much information available management must
priorities which information is most important to running the business.
Handy (1985) describes four different types of management information and provides
a description of the kind of information process by each
Planning: The bringing together of information to prepare Strategic Tactical

immediate action programmes e.g. a weekly production schedule or two year
investment programmes .

Logistics: The flow of information to link the different departments of an

organization to point out requirements for corrective actions to happen or to
stop other occurring .e.g. Inventory management.
Monitoring and Control:
information to monitor the work of an
organization to point out requirements for corrective action for improvement

e.g. Variance analysis monthly sale reports.
Motivation: information used to allow individuals or groups more

involvement or motivation e.g. targets and objectives, general information
regarding the organization .

Strategic role of IT in Business

As we know that organization put forward a number of reasons why they invested in
information technology. The most common reason includes the need to sustain and
improve competitive position, increase revenue, reduce cost or improve flexibility and
responsiveness. While these are important many organizations are driven simply by
the need to survive in highly competitive environment or market. thus banks installed
ATMs to increase customer services , the reliability is that once one bank had
installed ATMs competitor were left with little choice but to match investment . The
use of IT has become increasingly strategic for a number of reasons. Which are
following?
IT significantly increases the choice of option available to company and plays

an important role in the effective and implementation of every element of
business.
It affects the process of marketing strategy development as it provides more

information to mangers Through the use of DSS.
It has potential to integrate different parts of business (Organization) and

provide more information to Managers. EIS for example affect the Vertical
flow of information through an organization. Top management has greater
access to information and reduced reliance on middle management to source
of that information .telecommunications networks allow information to easily
and quickly between different departments and divisions.
It also affects the organizations interfaces with external environment such as

customers and supplier. Inter-organizational systems, facilitated by electronic
is data inter change for instance, create closer links between organizations and
their suppliers, facilitates more efficient inventory management and allow a
just in time approaches to reordering.
There is a key role for marketing in understanding and utilizing the enormous
potential of IT to market good & services more effectively.

Information System in the Enterprise
Major Types of System in Organization

Because of different types of interests, specialties and level in an organization, there
are different kinds of systems.
Three main categories of information system serve different organizational level:
Operation Level System:

Support operational Managers by keeping track of element activities and transaction
of organization such as sale, receipt, cash deposits, payroll, credit decisions and flow
of materials in a factory. The principal purpose of system at this level is to answer
routine questions to track the flow of transactions through the organization.
How many parts are in inventory?
What happened to payment?
In banks Operational level Systems include a system to record banks deposits
from ATMs or one that tracks the no. of hours worked each day by employees on
banks
To answer these types of question we used TPS (transaction processing system)
Transaction processing system (TPS):
A TPS collects and stores information about transactions, and controls some aspects
of transactions. A transaction is an event of interest to the organization. E.g. a sale at a
store.
A TPS is a basic business system. It:
Serves the most elementary day-to-day activities of an organization;
Supports the operational level of the business;
Supplies data for higher-level management decisions.
Is often critical to survival of the organization
Mostly for predefined, structured tasks
Can have strategic consequences
Usually has high volumes of input and output

provides data which is summarized into information by systems used by

higher levels of management
Need to be fault-tolerant.
On-line transaction processing: A transaction processing mode in which transactions

entered on-line are immediately processed by the CPU.
Management Level System
Serve the monitoring, controlling, decision making and administrate activates of

middle manger the principal question addressed by such
Are things working well?
Management level system typically provided the periodic reports rather than instant
inf0ormation on operation.
Management information system (MIS):
Converts TPS data into information for monitoring performance and managing an
organization. Transactions recorded in a TPS are analyzed and reported by an MIS.
They have large quantities of input data and they produce summary reports as output.
Used by middle managers. An example is an annual budgeting system.
Decision Support System (DSS):
Information system at the organization Management level that combines data and
sophisticated analytical models or data analysis tools to support semi-structured and
unstructured decision
DSS helps strategic management staff (often senior managers) make decisions by
providing information, models, or analysis tools. For support of semi structured and
unstructured decisions (structured decisions can be automated). Used for analytical
work, rather than general office support.

They are flexible, adaptable and quick. The user controls inputs and outputs. They
support the decision process and often are sophisticated modeling tools so managers
can make simulations and predictions.
Their inputs are aggregate data, and they produce projections. An example job for a
DSS would be a 5 year operating plan.
Strategic level systems

Help senior management tackle and address strategic issues and long-term trend both
in firms and external environment their principal concern is matching changes in
external environment with organizational capability. What employment level be in 5
years? What are the long term industry cost trends and does our firm fit in? What
products should we be making in Five years?
Executive information system (EIS):

Also known as an Executive Support System (ESS), it provides executives
information in a readily accessible, interactive format. They are an MIS for executive
use. An EIS/ESS usually allows summary over the entire organization and also allows
drilling down to specific levels of detail.
Used by top level (strategic) management. They are designed to the individual. They
let the CEO of an organization tie in to all levels of the organization. They are very
expensive to run and require extensive staff support to operate.
Office automation system (OAS):

OAS provides individuals effective ways to process personal and organizational data,
perform calculations, and create documents.
e.g. word processing, spreadsheets, file managers, personal calendars, presentation
packages
For are used for increasing personal productivity. They reduce "paper warfare". OAS
software tools are often integrated (e.g. Word processor can import a graph from a
spreadsheet) and designed for easy operation.

Communication systems:
Helps people work together by sharing information in many different forms

Teleconferencing (including audio conferencing, computer conferencing,
videoconferencing), electronic mail, voice mail, fax
Groupware system:
Helps teams work together by providing access to team data, structuring

communication, and making it easier to schedule meetings. For sharing information,
controlling work flows, communication/integration of work
KNOWLEDGE WORK SYSTEMS (KWS):

Are used by technical staff. KWS use modeling functions to convert design
specifications into graphical designs. They may include computer-aided
design/manufacture (CAD/CAM).
Expert Systems
Expert system: a computer system or program that uses artificial intelligence

techniques to solve problems that ordinarily require a knowledgeable human. The
method used to construct such systems, knowledge engineering, extracts a set of rules
and data from an expert or experts through extensive questioning. This material is
then organized in a format suitable for representation in a computer and a set of tools
for inquiry, manipulation, and response is applied. While such systems do not often
replace the human experts, they can serve as useful adjuncts or assistants. Among
some of the successful expert systems developed are INTERNIST, a medical
diagnosis tool that contains nearly 100,000 relationships between symptoms and
diseases, and PROSPECTOR, an aid to geologists in interpreting mineral data."
Expert systems imitate human experts in many different fields of expertise. Such
systems contain rules (such as decision tables) that help human answer expert
questions.
Expert systems are built with decision-making rules, and they can ask humans a series
of questions to narrow down the correct answer.

Advantages of expert systems:
The computer can store far more information than a human.
The computer does not 'forget', make silly mistakes or get drunk when it is
most needed.
Data can be kept up-to-date.
The expert system is always available 24 hours a day and will never 'retire'.
The system can be used at a distance over a network.
Expert systems are computer application programs that take the knowledge of one or
more human experts in a field and computerize it so that it is readily available for use.
The human experts do not need to be physically present to accomplish a specialized
project or task. Expert systems are only designed to be expert in a very narrow and
specific task or subject field. They contain the acquired expert knowledge and try to
imitate the experts evaluation processes to offer a conclusion. An advantage of an
expert system is that it may include the knowledge of many experts in one specific
field.
Expert systems usually contain two components: a knowledge base and an inference
engine program, enabling it to suggest conclusions. The knowledge base is
programmed in an IF ... THEN logical rules structure. Such a structure is a series of IF
conditions that, if met, THEN a specific result may be concluded. An example would
be:
IF the animal is a bird
it does not fly
It swims
It is black and white
THEN it is a penguin

Systems from a Functional Prospective

Sale and Marketing systems
The sale and marketing function is responsible for selling the organization
products or services. Marketing is concerned with identifying the customers for
the firms products or services. Systems that support the sales and marketing
function by facilitating the movement of goods and services from producers to
customers.
Examples:
Sales support - keep customer records, follow-up
Telemarketing - use phone for selling
Order processing - process orders, produce invoices, supply data for sales
analysis and inventory control
Point-of-sale - capture sales data at cash register often by scanner
Customer credit authorization - advice on credit to be allowed to customer.
Automatically record and total purchase transactions and prints out a packing
list
Improve customer service
Maintain customer data
Finance & Accounting Systems:

Systems that maintain records concerning the flow of funds in the firm and
produce financial statements, such as balance sheets and income statements .e.g.
for Budgeting; General Ledger; Billing: Cost Accounting, Accounts Receivable /
Payable; Funds Management Systems, Payroll. They were among the earliest
systems to be computerized.
Examples of financial systems: cash management, loan management, check

processing, securities trading.
Example: Visa's Credit Card payment system.

Human Resources Information system
An HRIS, the abbreviation for Human Resources Information System, is a system that
lets you keep track of all your employees and information about them. It is usually
done in a database or, more often, in a series of inter-related databases.
HRIS systems include the employee name and contact information and all or some of
the following:
department,
job title,
grade,
salary,
salary history,
position history,
supervisor,
training completed,
special qualifications,
ethnicity,
date of birth,
disabilities,
veterans status,
visa status,
benefits selected,
and more.
HRIS include reporting capabilities. Some HRIS track applicants before they become
employees. Some HRIS systems are interfaced to payroll or other financial systems
The Human Resource Information System (HRIS) is a software or online solution for
the data entry, data tracking, and data information needs of the Human Resources,
payroll, management, and accounting functions within a business. Normally packaged
as a data base, hundreds of companies sell some form of HRIS and every HRIS has
10

different capabilities. Pick your HRIS carefully based on the capabilities you need in
your company.
Typically, the better The Human Resource Information Systems (HRIS) provide
overall:
Management of all employee information.
Reporting and analysis of employee information.
Company-related documents such as employee handbooks, emergency

evacuation procedures, and safety guidelines.
Benefits administration including enrollment, status changes, and personal

information updating.
Complete integration with payroll and other company financial software and
accounting systems.
Applicant and resume management.

The HRIS that most effectively serves companies tracks:
Attendance and PTO use,
Pay raises and history,
Pay grades and positions held,
Performance development plans,
Training received,
Disciplinary action received,
Personal employee information, and occasionally,
Management and key employee succession plans,
High potential employee identification, and
Applicant tracking, interviewing, and selection.

An effective HRIS provides information on just about anything the company needs to
track and analyze about employees, former employees, and applicants. Your company
will need to select a Human Resources Information System and customize it to meet
your needs.
11

With an appropriate HRIS, Human Resources staff enables employees to do their own
benefits updates and address changes, thus freeing HR staff for more strategic
functions. Additionally, data necessary for employee management, knowledge
development, career growth and development, and equal treatment is facilitated.
Finally, managers can access the information they need to legally, ethically, and
effectively support the success of their reporting employees.
Examples: personnel record keeping, applicant tracking, positions, training and skills,
benefits.
Manufacturing and production systems:
The manufacturing and production system is responsible for actually producing the
firm s goods and services.
Manufacturing and production systems deal with the planning development and
maintenance of production facilities, establishment of production goals, the
acquisition, storage and availability of production materials and scheduling equipment
facilities, material and labors require system to fashion finished products
In the manufacturing and production function CAD, CAM, and Virtual reality
Technology Group technology. The benefits of CAD and CAM include:
1. Product quality
2. Shorter design
3. Production cost reductions
4. Database availability
5. New range of capabilities etc
12

New Development in Management Information
Data warehouse
Data warehouse is very large database that holds operational historical and
current data about customers and makes it available for decision making
purpose.
It is the foundation of many DSS applications and is design help users
make better decision by analyzing summarized snapshots of corporate
performances
In the 1980s and early 1990s many large organizations were examine the
way in which management information was reported and used the
oversupply of data and the undersupply of good management information
prompted these companies to investigate how technology could be used to
provided better decision making information . One of the main reasons that
DSS application has not reached their full potential in the past is because
the data has either been of very poor quality or has been difficult to access.
In banks data ware house is used for
Category Management.
Data ware house can help mangers gain a better understanding of
consumers buying patterns and consumer response to their promotion
Claim Analysis :
In the banks data ware house is used application to control cost and
provide better customer services.
Fraud detection
Fraud detection is one of the more popular application no f data ware
housing especially in banks
13

Interest Rate Management

Banks are used data warehouse for interest rate a management on the bases
of information available in data warehouse information about customers
profiling and reputation in market.
Data mart (DM)

is a specialized version of a data warehouse (DW). Like data warehouses, data marts
contain a snapshot of operational data that helps business people to strategize based
on analyses of past trends and experiences. The key difference is that the creation of a
data mart is predicated on a specific, predefined need for a certain grouping and
configuration of select data. A data mart configuration emphasizes easy access to
relevant information.
There can be multiple data marts inside a single corporation; each one relevant to one
or more business units for which it was designed. DMs may or may not be dependent
or related to other data marts in a single corporation. If the data marts are designed
using conformed facts and dimensions, then they will be related. In some
deployments, each department or business unit is considered the owner of their data
mart which includes all the hardware, software and data.This enables each
department to use, manipulate and develop their data any way they see fit; without
altering information inside other data marts or the data warehouse. In other
deployments where conformed dimensions are used, this business unit ownership will
not hold true for shared dimensions like customer, product, etc.
Data Mining
With the aid of good data base of information (data ware house) and some good
analytical tools (DSS or OLAP) with which to query the database comapanies can
Mine for hidden information which can be used for market pupose .
14

Companies which mine their data are looking for new correlations that may help them
gain some insights into customer behaviour and competive advantage in the
makerting place .
In the financial services industry like banks such as sonire bank used data mining
technique for fraude prevention , credit scoring cross selling ,opportunities and
marketing campaigns .
The availabilty of large ammounts of trasctions data on credit card usage again
capture at EPOS terminal ,making data mining and the used od neural network s.
Artificial Intelligence and Neural netwok technology

Arificial intelligences systems have been used in the secientfic community for many
year and during the 1980s some success full atempts were made to comnmercialise
these system and use them for purpose such as marketing . by 1990s the technology
had advaced to a stage where it was more reliable and cheaper to used and it has now
found application in serveral areas of marketing
The fundamental concept behind neural network technology is that a computer can be
trained to solve a problem in a simliar fashion to a human brain by recognizing
familiar patterns
15

Enabiling Technologies
There are enabling technology that allow organizations to share information and
knowledge more easily between employees this include
Local area network (LANs)and wide area network (WANs)
A local area network is a network that links PCs with in the same buliding or bon the
same floor of buliding ,
It enable people who work in the same department to share information with each
other, typically the information and files that are share between employees are
located on central PC or server to which all departmernt employees have access.
Different groups of employees may have different levels of access to these electronic
files .
When companies want to link employees located in different buliding or different
cities , this architecture is known as WAN and typically used to ling serveral LANs .
Interanet
Wihle the interanet is global public mediun for liking different businesses and
individuals , there are also private version of the internet which only be accessed by
employees of onre organization and are protected by passwards and other security
feature . the intranet can also like to the outside world by conecting to internet but are
primerily for internal used within a company or between companies and its trading
pattern
Groupware
Sotfware that provides fuctions and servises that support the collabration of work
group
The Growth of the E Commerce

Electronic commerce is a term used for a v ariety of different methods of conducting
business electronically. The term covered a wide variety of concept and payment
16

mechanisms. The main category of the electronic payment system as well as different
types of the plastic card whioch enab le electronic payments to bge made . Three
broad categories of the electroni c payment system are
Electronic fund transfer & Electronic fund transfer at a point of sale
Electronic data interchange
Electronic money
Electronic Fund Transfer

EFT cab be used for both commercial and personal payments. In
commercial Arena Swift stand out as a international standard for the
transfer of high value financial transctions.. It was established in Briselss
in 1973 to automate the function previsously carried out by Telex and is
used in more than 4000 financial instituitions worldwide to process
approximately 500 million transctions per year.
Individual banks has also set up their own electronic commerce system for
their cvustomers . One of the first bank to implied technology in this way
is MCB bank for commerc ial customers.
When credit cards or de bit cards are used to purchsase goods or services
in a shop or retailing outlet the transction is reffered to electronic fund
transfer at a point of scale and usually rewffer to personal rather than c
ommercial payments..
Electronic Data Interchange

EDI is an electronic data transfer mechanism in a wide range of business
transctions. It is usually associate with the automition of billing cycle
where invoice and purchase orders are generated and send automatically
from one company to anoither . There are different standards for different
industries . Although ,convergence and rationalism are inevitable. The
primary benefits for the ortganzatio n the implemeatation of EDI is to
17

reduce the transcyion cost for purchasing and transferring the goods and
invoice.
Electronic Money
The benefits that are claimed for electronic moneyh include greater
efficiency as hard currency and checks are not required and greater sec
urity as no cash is handeled
The transction can be carry out at point of sale using different payment of
mechanism some of which are electronic and information based some
which are not . The electronic mechanism included plastic card ,smart
card, credit card , debit cards.
18

SONERI BANK LIMITED

History and Introduction:
Incorporated on September 28, 1991 the first Branch of Soneri Bank Limited
formally opened doors for operations in Lahore on April 16, 1992 followed by
Karachi Branch on May 09, 1992. The bank now operates with 72 branches spread all
over Pakistan including the Northern Areas of the country where no other private
bank has ventured so far. Expansion of branches is based on a policy of maintaining a
balance between the urban and rural areas with a view to offering services even in the
remote areas of Pakistan. Pleasant and sophisticated atmosphere has been provided in
the branches which are all fully air-conditioned and computerized.
The essence of our business philosophy is to cater to the banking requirements of
small & medium sized entrepreneurs, providing them qualitative & competitive
services with emphasis on encouraging exports. Nearly forty percent of our credit
portfolio is related to export financing and credit decisions are taken within 48 hours
that is why we say:
We have more time for you
19

Products of Soneri Bank

Following are the services provided buy the Soneri bank.
PLS Saving account

Soneri Saving
Term Deposits
Soneri Sarmaya
Basic Bank account
Soneri Car Financing
Ghar Financing
On-line banking
De bit card ]
Credit card
ATMS
20

How Soneri bank used MIS in its banking operations

Soneri bank is used a custom made data base Management system known as
sonaware version 4.1 which are divided into following categories
Sonaware site in which are used for handling ATM transactions
Sonaware Citrix which are used online account transactions on daily basis
and as well as weekly and monthly basis and create reports for daily, weekly
and monthly transactions of online account
Sona HR which are used for handling the HR functions and related issues
HRIS systems include the employee name and contact information and all or some of
the following:
department, job title, grade, salary, salary history, position history, supervisor,
training, completed, special qualifications, ethnicity, date of birth, disabilities,
veterans status, visa status, benefits selected, and more.
Sona market which are used for handling the marketing functions
Sona Finance which are used for handling the accounts and finance e
functions of Soneri bank
21

Sona Network system
It is a combination of LAN and WAN which connects all branches of

Soneri banks located in the North and South region to central office which
are located at Karachi as shown in the figures
Central offices
South region
North region
South Regional
offices
North Regional
offices
Branches
Branches
22

Summary and Conclusion

Management information system is the key to success for any business in the current
business environment. The business environment totally changed from the traditional
environment.
The organizations are changed its business functions from the
traditional manners to the electronic means.

Information systems are the foundation for the conducting business in the current
business environment.
In many industries survival and even existence without
extensive use of IT is inconvincible and IT plays a critical role in increasing

productivity. IT can provide the competitive advantage to the organizations as it
creates value for the firm and decreased its cost.
Summing up, if a business wants to get survival in the current business environment
the business should adopted to the practices of Management information system.
23

Reference:
Management Information System 9th edition by KENNETH C. LAUDON ,

JANE P. LAUDON
www.wikipedia.com\datawarehouse
www.soneribank.com
Muhammad Hafeez Network administrator Soneri Bank Branch Mozang

chungi Lahore
www.google.com
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APPLICABILTY OF ADVANCE MIS IN BUSINESS ENVIRONMENT

Planning: The bringing together of information to prepare Strategic Tactical

Generated by Foxit PDF Creator Foxit Software

Logistics: The flow of information to link the different departments of an

Monitoring and Control:

information to monitor the work of an

organization to point out requirements for corrective action for improvement

Motivation: information used to allow individuals or groups more

Generated by Foxit PDF Creator Foxit Software

Strategic role of IT in Business

IT significantly increases the choice of option available to company and plays

It affects the process of marketing strategy development as it provides more

It has potential to integrate different parts of business (Organization) and

It also affects the organizations interfaces with external environment such as

Generated by Foxit PDF Creator Foxit Software

Information System in the Enterprise

Major Types of System in Organization

Operation Level System:

Transaction processing system (TPS):

Serves the most elementary day-to-day activities of an organization;

Supports the operational level of the business;

Supplies data for higher-level management decisions.

Is often critical to survival of the organization

Mostly for predefined, structured tasks

Can have strategic consequences

Usually has high volumes of input and output

Generated by Foxit PDF Creator Foxit Software

provides data which is summarized into information by systems used by

On-line transaction processing: A transaction processing mode in which transactions

Management Level System

Serve the monitoring, controlling, decision making and administrate activates of

Management information system (MIS):

Decision Support System (DSS):

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Strategic level systems

Executive information system (EIS):

Office automation system (OAS):

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Helps people work together by sharing information in many different forms

Helps teams work together by providing access to team data, structuring

KNOWLEDGE WORK SYSTEMS (KWS):

Expert system: a computer system or program that uses artificial intelligence

Generated by Foxit PDF Creator Foxit Software

Advantages of expert systems:

The computer can store far more information than a human.

Data can be kept up-to-date.

The system can be used at a distance over a network.

Generated by Foxit PDF Creator Foxit Software

Systems from a Functional Prospective

Sales support - keep customer records, follow-up

Telemarketing - use phone for selling

Point-of-sale - capture sales data at cash register often by scanner

Customer credit authorization - advice on credit to be allowed to customer.

Improve customer service

Maintain customer data

Finance & Accounting Systems:

Examples of financial systems: cash management, loan management, check

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Human Resources Information system

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Management of all employee information.