Management Information system Metrics

Inefficient Management Optimum Profitability

HIGH

Efficient Information System and Recording

of Transactions

LOW Meeting Legal Requirement Efficient Management

LOW HIGH

Credibility of Decision Making

(Efficiency of Management)

MIS METRICS- This metrics provide an insight about the different proportion of efficiency of both,
information system & database and management help to turn favorable outcome for the company’s
fortune.

Assumption –

1. There is a positive correlation between investment in MIS and increase in overall all
profitability.
2. The company is not able to reach its objective with the low level of investment in MIS.
3. MIS become efficient when an upgradation happen.
4. Data help to provide granular insights about the subject matter for decision making.

Detailed Description of each quadrants-

1. Meeting Legal Requirement- In this quadrant, the efficiency of both, management and
the level information system are low, which indicated that the company is only
recording and storing data just to meet the legal compliance i.e. for accounting and
auditing use. The company more focuses on sustaining its business rather to make a
potential investment for upgradation of information system through which the data can
be channelized in most optimum use.
 In such a scenario, company could be able to save cost, or more appropriate to say that
company will not incur additional or extra on both, revenue and capital expenditure and
thus, helping to maintain current return of investment without taking any further cost of
equity/debt obligation.
This form of combination will work in less competitive market and where the market is
less volatile or dynamic else, in competitive environment company will start losing its
market share and end up giving the competitive advantage because, in competitive
environment a lot factors needs to be taken into consideration for which data at every
point need to stored and assessed, not only the data which is compulsorily required.

2. Inefficient Management- In this quadrant, the company is employing modern method of

information system, but the management’s decision is not becoming fruitful for the
company in terms of overall growth objective. In other words, the company’s
management is not able to leverage the true potential of information system, and hence
lacking in taking competitive advantage.
The company might be employing the automated information and analysing system but
the management is not able to extract the vital information for decision making and
further planning, which degrade the credibility of decision made by management and
that can result a detrimental outcome for the company.
The cost will be huge (on both management and information system) and incremented
profit by employing such system will be low and that’s the point company should start
worrying about their investment made and looking at the remedies, weather to employ
new management personnel or to train the current personnel to get the best out the
data.

3. Efficient Management- In this quadrant, while having a low level of investment in

information system, management is able get some insight that is fruitful for company’s
growth objective and fostering the competitive advantage over competitors.
This shows that company had employed better management personnel and they are
able to generate considerable consideration for the company.
This quadrant shows a cost reduction by employing an optimum management with a
truncated information system. Nevertheless, the company will not able to have
optimum profitability and still have a chance to use underlying data sources though an
upgradation in the information management system to generate more insights.
This combination will be fruitful in a scenario, where the company do not want to
leverage its financial resources and putting more focus to sustain business by not adding
further cost.

4. Optimum Profitability- In this quadrant, the management’s decision credibility and

investment made in upgradation of information system is at the top, and the system is
providing many great insights at every point of business the company is making.
With detailed information of every aspect business stored in the company’s
infrastructure or in cloud system, the competent management are able to gain insights
and then successfully able to implement the analysis outcome in different aspects of
business.
Certainly, it creates a huge cost to the company but the result of deploying such system
have increased the profitability of the company manifolds and hence, helps to achieve
company’s financial or other growth objectives.
It is highly recommended in the situation when company have a sound infrastructure,
finance source where financial obligations are less than returns and operating in highly
competitive data driven market.