International Journal of Management (IJM)

Volume 7, Issue 4, May–June 2016, pp.179–188, Article ID: IJM_07_04_015

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IMPACT OF MANAGEMENT
INFORMATION SYSTEM (MIS) ON
MANAGERS DECISION IN INDUSTRIAL
COMPANIES IN INDIA
Hamzah Abdulrahman Yahya Al habri
Ph.D. Research Scholar
North Maharashtra University, Maharashtra

Dr. Madhulika A. Sonawane

Associate Professor and Ph.D Guide
School of Management Studies
North Maharashtra University, Maharashtra

ABSTRACT
Information is an indispensable resource in organizations and should it be
managed in an efficient way for effective decisions. Management Information
System (MIS) has the ability to facilitate decision making by managing and
providing the right information to managers in a particular organization. This
study gives an insight into the impact of the MIS on managers’ decisions in
industrial companies. The study was conducted in forty five manufacturing
companies and the responses were from managers who have the authority to
make decisions in the company. Companies are categorized into three groups
based on turnover to make an effective comparative study. Questionnaires,
interviews and observation were used to collect the data and this data was
statistically analyzed using the Binomial -Test in IBM-SPSS Version 21. To
provide adequate information for effective decision making, it is suggested
that industrial companies should take all business functions into consideration
while developing the MIS and the awareness on the importance of MIS should
be created in the companies that have less turnovers. The scope of this study is
limited to describing the relationship between the MIS and the decision
making in industrial companies.
Key words: MIS, Decision Making, Information, Data

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 Hamzah Abdulrahman Yahya Al Habri and Dr. Madhulika A. Sonawane

Cite this Article: Hamzah Abdulrahman Yahya Al Habri and Dr. Madhulika
A. Sonawane, Impact of Management Information System (MIS) On
Managers Decision In Industrial Companies In India. International Journal of
Management, 7(4), 2016, pp.179–188.
http://iaeme.com/Home/issue/IJM?Volume=7&Issue=4

1. INTRODUCTION
Information is an indispensable resource for any firm and it should be managed in an
efficient way. It assists managers to take right decisions associated with a particular
situation. Management information system has the potential to manage the
information and provide it to managers in every department within the organizations.
Gathering information comes through processing data showing that data is the
original source that can be suitable for usage or process. Hence the MIS captures data
from different sources accurately, processes it fast and stores it to make the access
easier.
The MIS plays a very important role in industries, ensures the right information is
delivered at the right time to the right person to satisfy the organizational needs. It
reduces manpower, quality cost, complexity, errors and saves time. The MIS helps in
defining the production and its efficiency in industrial companies by generating the
required data and information for managers. It also creates different reports to obtain
necessary information for scheduling and forecasting.
The MIS assists companies in strategic and short term planning as well as
management and operation control. It provides several applications in every area in a
particular organization such as production, finance, marketing and Human Resources
managements. Those applications help managers in controlling the organizational
functions, management planning and risk management. The effective decision
depends on availability of information, thus the main purpose of MIS is to provide
right information to support the management to handle all activities and tasks. From
that perspective we can realize that MIS helps managers in making rational decisions
that will lead to better business.
The nature of management information system has completely changed, reporting
has become more online and real time is linked to business at point in time. Therefore
companies need to take the new changing in Management Information Systems into
consideration for increasing business efficiency.

2. OBJECTIVE OF THE STUDY

1. To study whether companies give priority to develop and implement MIS.
2. To study and analyze whether MIS facilitates managers’ decisions by providing the
right information.

3. HYPOTHESIS OF THE STUDY

To provide solution to this research paper, hypotheses were formulated and tested in
and the hypotheses are:
 : Management Information System does not facilitate managers’ decision in
industrial companies.
 : Management Information System does facilitate managers’ decision in
industrial companies.

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 Impact of Management Information System (MIS) On Managers Decision In Industrial
Companies In India

4. RESEARCH QUESTIONS
1. Is the person who takes a decision aware of the importance of MIS?
2. Does the company give priority to developing and implementing MIS in the
company?
3. Is there a positive relationship between MIS and managers’ decisions?
4. Does MIS provide the right information to the right person at the right time for
effective decision making?

5. REVIEW OF LITERATURE
In introduction to Management Information System was shown for the study, The
Selected Works of Umakant Mishra, Bangalore, Iindia. The author has explained the
MIS, its similarities and differences to other information systems as well as the
difference between management information system and information system
management. MIS is defined as a systematic organization and presentation of
information that is generally required by the management of an organization for
making judicious decision for the organization. It is not an easy task to describe the
MIS structure due to the fact that the objectives and structure of organizations are not
same. The main source of MIS is data which can be extracted from day to day
activities in the organization and data can be collected from different sub-systems
such as human resource system, production management system, financial
management system and others. Another type of data that can be collected is from
external sources like competitor’s data. The differentce between management
information system and management of information system is that information
management can be for any purpose while MIS is intended for managers which means
that the MIS is a sub set of organizational information system. The similarities
between MIS and other systems are: involves the same computing infrastructure and
technologies, same components such as input, output and processing and same
process of developing the systems. Purposes of information systems make the
differences among them and from that point we can say that Transaction Processing
System deals with day to day activities while Management Information System
provides information to all departments in organization and the Decision Support
Systems are meant for helping the decision makers in making complicated decisions.
Executive Support System is used for necessary information to top management for
making unstructured and long term decisions. Any workflow of organization can be
computerized by Office Automation Systems. To sum up, MIS has an impact on
business performance and it can be implemented for top management of
organizations. MIS structure goes accordingly with the organizations tasks and
activities. In MIS volume of data can be less than other information systems to some
extent. Three levels of management MIS can deal with are : the top management takes
strategic planning and control, meddle level management deals with tactical planning
and lower level management works on operational planning. Managers need to take
the right decision for making the business more effective and for accomplishing that,
information is vital and the MIS is the best tool to make the availability of
information at the right time.

6. RESEARCH METHODOLOGY
This study has exposed the Impact of MIS on managers’ decision in industrial
companies in India. Four districts have been selected to conduct this study, namely
Pune, Aurangabad, Jalgaon and Dhulia. Managers from different company sizes

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 Hamzah Abdulrahman Yahya Al Habri and Dr. Madhulika A. Sonawane

participated in this study by providing opinions regarding the MIS and its impact on
decision making. The population of this study comprises managers of forty five
industrial companies. The questionnaire and observation were applied to collect the
required data for the research. Companies have been categorized into three groups
across turnover to make an effective comparative study (1= more than $1,000,000,
2=$500,000$ - 1,000,000, 3=less than $500,000). Questionnaires were distributed to
the managers in the companies and the feedback from the respondents was
affirmative. The most important source of data collection was through questionnaires
and observations, and along with those techniques the researcher has conducted
individual interviews with company managers.

7. DATA INTERPRETATION AND ANALYSIS

The MIS and decision makers: respondents were asked to comment on if the person
who takes a decision is aware of the MIS using two respond options (1=Yes, 0=No).
The data was analyzed individually across the three groups of turnover study (1=
more than $1,000,000, 2=$500,000$ - 1,000,000, 3=less than $500,000).
Is the person who takes a decision
aware of the MIS or computer or is
Turnover he/she trained in any computer Total
course?
No Yes
More than Count 0 22 22
1,000,000 Expected Count 3.6 18.4 22.0
Dollars
% within Turnover 0.0% 100.0% 100.0%
Count 1 21 22
500,000 - Expected Count 3.6 18.4 22.0
1,000,000 % within Turnover 4.5% 95.5% 100.0%
Dollars
Less than Count 10 13 23
500,000 Expected Count 3.8 19.2 23.0
Dollars % within Turnover 43.5% 56.5% 100.0%
Total Count 11 56 67
Expected Count 11.0 56.0 67.0
% within Turnover 16.4% 83.6% 100.0%
Table 1 :the MIS and decision makers

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 Impact of Management Information System (MIS) On Managers Decision In Industrial
Companies In India

the MIS and decison makers

120%

100%

80%
count

60%
Yes
40%
No
20%

0%
more than $1 million $500,000-1 million $less than 500,000
turnover

Figure 1 The MIS and decision makers

From the table and chart, it can be concluded that, all managers in the companies
that have turnover of more than $1 million are aware of the MIS. In comparison with
companies having turnover of $500,000 - 1,000,000, 95.5% of decision makers also
have knowledge about the MIS. However companies with turnover of less than
500,000$, only 56.5% of decision makers know about the MIS or had trained in any
computer course.
Priority for developing, implementing and maintaining the MIS: The same two
options that were mentioned in the first question were also offered to the respondents
to comment on priority of developing the MIS. They were further provided with
following question: Does the company give priority to developing and implementing
the MIS?
The data was analyzed separately based on the three groups of (1= more than
$1,000,000, 2=$500,000$ - 1,000,000, 3=less than $500,000).
Does the company give priority
to developing and
Turnover Total
implementing the MIS?
No Yes
More than 1,000,000 Count 0 22 22
Dollars % within Turnover 0.0% 100.0% 100.0%
Count 11 11 22
500,000 – 1 million % within Turnover 50.0% 50.0% 100.0%
Dollars
Count 13 10 23
Less than 500,000$ % within Turnover 56.5% 43.5% 100.0%
Total Count 24 43 67
% within Turnover 35.8% 64.2% 100.0%
Table 2: priority to MIS development

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 Hamzah Abdulrahman Yahya Al Habri and Dr. Madhulika A. Sonawane

priority to MIS development

120%
100%
80%
count

60%
Yes
40%
No
20%
0%
$more than 1 million $500,000-1 million$ less than $500,000
turnover

Figure 2 Priority to MIS development

Table 2 indicates that 100% of the respondents from companies that have turnover
of more than $1 million, said that the company gives priority to developing and
implementing the MIS. In contrast to, companies with turnover of $500,000 to I
million, 50% of the respondents said the company gives priority to developing and
implementing the MIS while the rest stated negative. However In the companies that
have turnover less than $500,000 , 43.5% of the respondents said the company gives
priority to MIS while 56.5% said the company does not give priority to developing ,
and implementing the MIS.
The MIS and decision making: The responses from the questionnaires are presented
in the tables and subsequently analyzed. They were asked to comment on three
important points regarding the MIS and decision making using the options (5=
strongly agree, 4= agree , 3= neutral , 2= disagree , 1= strongly disagree, 0= don’t
know ) the points are :
a. There is a positive relationship between the MIS and managers decisions.
b. MIS provides the right information to the right person at the right time for
decision making.

Data for the MIS and decision making were analyzed across the three groups of
turnover individually (1= more than $1,000,000, 2=$500,000$ - 1,000,000, 3=less
than $500,000).
There is a positive relationship between the MIS and managers decisions.
Valid Cumulative
Turnover Frequency Percent
Percent Percent
More than Valid Agree 9 40.9 40.9 40.9
1,000,000$ Strongly agree 13 59.1 59.1 100.0
Total 22 100.0 100.0
500,000 – 1 Valid Don't know 3 13.6 13.6 13.6
million$, Agree 9 40.9 40.9 54.5
Strongly agree 10 45.5 45.5 100.0
Total 22 100.0 100.0
Less than Valid Don't know 9 39.1 39.1 39.1
500,000$ Agree 9 39.1 39.1 78.3
Strongly agree 5 21.7 21.7 100.0
Total 23 100.0 100.0
Table 3: the MIS and managers decision

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 Impact of Management Information System (MIS) On Managers Decision In Industrial
Companies In India

Table3 shows that in companies that have turnover of more than $1 million,
50.1% of the respondents strongly agree that there is a positive relationship between
the MIS and managers decisions while 40.9% of respondents are of similar opinion.
In companies that have turnover $500,000 to 1 million 45.5% of the respondents
strongly agree that there is a relationship between the MIS and managers’ decisions,
40.9% have the same opinion while 13.6% of the respondents do not know. On the
other hand companies with turnover less 500,000$, only 21.7% of the respondents
said that there is a relationship between the MIS and managers decision , 39.1% of the
respondent do agree while 39.1% do not know if there is a relationship between the
MIS and managers decisions.
The MIS provides the right information at the right time for effective decisions .
Valid Cumulative
Turnover Frequency Percent
Percent Percent
More than Valid Neutral 9 40.9 40.9 40.9
1,000,000$ Agree 4 18.2 18.2 59.1
Strongly agree 9 40.9 40.9 100.0
Total 22 100.0 100.0
500,000 – 1 Valid Don't know 3 13.6 13.6 13.6
million$ Neutral 1 4.5 4.5 18.2
Agree 9 40.9 40.9 59.1
Strongly agree 9 40.9 40.9 100.0
Total 22 100.0 100.0
Less than Valid Don't know 9 39.1 39.1 39.1
500,000$ Neutral 3 13.0 13.0 52.2
Agree 7 30.4 30.4 82.6
Strongly agree 4 17.4 17.4 100.0
Total 23 100.0 100.0
Table 4: the MIS and information
From the table4, it can be seen that companies with turnover of more than $1
million, 40.9% of the respondents strongly agree that the MIS provides the right
information for effective decision making, 18.2% have similar opinion while 40.9 %
of the respondents are neutral. In contrast to companies that have turnover of
$500,000 to 1 million, 40.9% of the respondents strongly agree that the MIS provides
the right information to mangers for effective decision making while 40.9% of the
respondents have similar opinion. On the other hand Companies with turnover of less
than $500,000, 39.1% of the respondents are not aware if the MIS provides
information for effective decision making while 30.4% agree and 17.4% strongly
agree.

8. TEST OF HYPOTHESIS
Purpose to study whether perception benefits differ across the three groups of
companies (1= more than $1,000,000, 2=$500,000$ - 1,000,000, 3=less than
$500,000).
 MIS do not facilitates effective managerial decisions
 MIS facilitates effective managerial decisions
Respondent were asked to comment on the following statement using a five point
scale (1=strongly disagree, 2=disagree, 3=natural, 4= agree, 5=strongly agree)
 There is a relationship between the MIS and managers decisions.

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 Hamzah Abdulrahman Yahya Al Habri and Dr. Madhulika A. Sonawane

 The MIS provides the right information to the right person at the right time.
Cut point: the original 5-point scale was converted to 2-point scale using cut point
as”3” in IMB SPSS 21. Hence the newly created categories were : <=3: disagree &
>3: agree
Statistical test: Binomial
Test proportion: test proportion was taken as 0.5 since more than 50% of favorable
responses to a particular category suggest greater approval for this category.
Hence: P=0.5
 : Proportion of responses is indicates “MIS does not facilitates effective
managerial decisions” is less than or equal to 0.5(P<= 0.5).
 : Proportion of responses indicates “MIS facilitates effective managerial
decisions” is more than 0.5(P> 0.5).
Level of significance: =0.05
Observed Exact Sig. (2-
Statement Category N Test Prop.
Prop. tailed)
There is a positive Disagree <= 3 12 .18 .50 .000
relationship between
the MIS and agree >3 55 .82
managers decisions.
Total 67 1.00

The MIS provides the disagree <= 3 25 .37 .50 .050

right information to
the right person at the
Agree >3 42 .63
right time.

Total 67 1.00
Table5: hypothesis testing

Interpretation
 There is a relationship between the MIS and managers decisions: Observed
proportion: 0.82, Test proportion: 0.5, P=0.500 Hence more than 50% agree that there
is a relationship between the MIS and mangers decisions.
 The MIS provides relevant, timely and accurate information for manag ers for
effective decision making: Observed proportion: 0.63, Test proportion: 0.5, P=0.050.
Hence more than 50% agree that The MIS provides relevant, timely and accurate
information for managers for effective decision making.
For the two variables the observed proportion is more than 50% and P value is
less than 0.05, hence, it indicates that there is a significant relationship between the
MIS and managers decisions and the hypothesis “MIS facilitates effective managerial
decisions” is proved.

9. THE STUDY FINDINGS

Based on the primary data that was analyzed and interviews, the study findings can be
concluded as:
1. Majority of company managers or owners who have an authority for decision making
are aware of the nature of MIS and its advantages in business performance.

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 Impact of Management Information System (MIS) On Managers Decision In Industrial
Companies In India

2. An important number of company managers are not aware of MIS or information

technology especially in the companies that have a small turnover.
3. Most of the companies in the three groups give priority to developing and
implementing the MIS. Even though some companies do not practice the MIS but
still development of MIS is their priority.
4. In the companies that have a large turnover, all managers agree that there is a
relationship between the MIS and decision making.
5. 39.1% of the respondent in companies with less turnover have no idea whether there
is a relationship between the MIS and managers’ decisions.
6. The majority of managers indicate that the MIS provides the right information at the
right time for effective decision making. On the other hand the minority of the
respondents in companies with less turnovers do not know whether the MIS provides
right information for effective decisions.
This study reveals impact of Management Information System on managers’
decisions in the selected manufacturing companies. Thus managers can utilize the
MIS for decision making to achieve company goals.

10. CONCLUSION AND RECOMMENDATIONS

This study dealt with the impact of Management Information System on managers’
decisions in manufacturing companies in Maharashtra state, India. Managers of
almost 45 companies were selected to share their important view regarding the MIS
and its impact on decision making. Greater part of the respondents is aware of the
importance of MIS in business performance. It is quite clear that most of the
companies give priority for developing and implementing the MIS for improving
business and facilitating the nature of work within the industrial companies. It can be
concluded that in industrial companies that have a large turnover, managers believe
that there is a positive relationship between the MIS and decision making, indicating
that the MIS plays a very important role in decision making for fulfilling the company
needs. Furthermore majority of the managers specify that the MIS provides the right
information at the right time for effective decision and that will lead to scaling
business in an easy way as well as adding productivity gains to the company. In
contrast, there is a significant proportion of the respondents who are not aware of the
MIS benefits which means that the MIS is not developed in their companies. The
explanations are that practising the MIS might be costly for some industrial
companies, especially micro ones. Understanding the MIS only as computer-oriented
causes difficulties to some company proprietors especially for those who are not
knowledgeable in computer. According to this study, it is suggested that to provide
adequate information for effective decision making, industrial companies should take
the five business functions into consideration while developing and implementing
because lots of companies purchase ready-software for only accounting transactions.
The five functions are production, finance, marketing, Human Resource and raw
material. It is recommended to the companies with lower turnovers that they should
take the MIS development and implementation the MIS development and
implementation and make it a priority for managing the activities and transactions
efficiently. The awareness of the impact of Management Information System on
decision making is very important in those types of companies and the government
should be involved in that. To create awareness, it is also recommended that owners
of those companies should get trained in the MIS or any computer courses.

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 Hamzah Abdulrahman Yahya Al Habri and Dr. Madhulika A. Sonawane

ACKNOWLEDGMENT
Heartfelt gratitude to Mr. Pramod Sancheti, the proprietor of Winley Polymers Pvt.
Ltd Company for his kindness and cooperation.

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