Ackoff’s Management Misinformation Systems

This Paper references a case study ‘Ackoff’s Management Misinformation Systems’ adapted from a classical

article written by Russell Ackoff fifty years ago. In this article Russell L. Ackoff identified five assumptions

commonly made related to management information systems and argues that in most cases these assumptions

are not reasonable, that often directs to major deficiencies in the systems termed as ‘Management

Misinformation Systems’. To triumph over the consequential deficiencies of these assumptions, Ackoff suggests

that management information system must be imbedded in a management control system.

Application of Ackoff’s assumptions

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In following Paragraphs Ackoff’s assumptions are discussed in detail as to whether these are applicable today

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or not with reasonable explanations.

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I. Due to lack of relevant information, most managers work under this insufficiency
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Ackoff’s first assumption is that most managers operate under the deficiency of lack of appropriate information.
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I would have to differ with this supposition as according to Ackoff only certain information is relevant and
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helpful while the other information is of no use and just overloads the work of manager. Hence top management

is sent over the data that is carefully scanned and filtered by lower level employees. At first point the lower
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level employees knowledge is limit to their job, they don’t know what information may become relevant at

what point, this screening of information by subordinate is completely not sensible. Secondly top management
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needs additional information and statistics and more quantitative data than it gets for decision making.
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The valuable information that might seem of no use at one point in time may become more imperative and very

useful at another time. Thus, I consider that all information be readily available on hand for the manager in

order to advance forward in a well-timed approach. As a manager I believe at times too large amount

information can become information burden. But to put up and develop the proper system you could do with

the information to make a decision which information is relevant for the manager.

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II. The manager needs the information he wants

Ackoff’s second assumption is that the manager needs information that he wants. I am of the same opinion to

certain aspects of this thought of Ackoff. There is no doubt that a manager does need useful information for

smoothly running the day to day business activities and providing proper direction to its subordinate. They

might not know all the information they want but what they ask for it should be provided. Ackoff’s thinking is

that at times it is hard to satisfy what information is needed for decision making. The system can provide the

required information only if it is clearly understood during the stages of development.

Lower level employees always tend to require more information, direction and support from the manager. In

the absence or lacking of proper direction, the employees will try completing their job by their own with the

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available relevant or irrelevant information. They would just try filling up their work time without getting their

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job goal. So the manager do needs information that he wants for managing his job more efficiently and more

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conveniently.
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According to article ‘Do senior manager really know what they want?’ a study was conducted for knowing
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whether the senior management really was getting information they needed from the system in use. The results
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were the senior management do know what they want but were not getting what they wanted and what they got

was always too detailed information from IT community.

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III. A manager will improve his decision making, if he has the information he needs
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Third assumption revolves around the availability of information that a manager needs for improving his
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decision making capability. This is a clear cut commonsense belief by Ackoff and there can’t be any

disagreement. There is no question that availability of necessary information is essential for making sound

decisions at every level of business. With the availability of required information the manager could easily

assess alternatives, judge outcome and make a proper judgement.

The manager can guide and direct employees under him only if he himself is made available with needed

documents. Without right information from top level, the people working for the manager will go the opposite

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way. Contrary, if the manager has the information that is required to complete the duty, then the purpose will be

solved in a short phase of time, with one and all contributing in a constructive way.

IV. A better communication between managers will improve organizational performance

Ackoff is of view that a better communication between managers will improve organizational performance.

There can’t be disagreement to Ackoff’s fourth assumption as communication is the most important part in

every aspect of business. It plays an important role when it comes to harmony and unison among the

individuals working for the same business. Sooner or later, the top level management is likely to cut off from

the rest of the organisation. Due to this isolation a gap of communication develops which results in lack of

mutual understanding, lack of willingness in accepting new ideas and knowledge.

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In the absence of proper communication and no direction from manager the sub ordinates lose focus and tend to

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complete their job by their own, thus divert from their actual goals. This diversion ultimately decreases the

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effectiveness of organisation as a whole.
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V. A manager doesn’t have to understand how his information system works, only needs to know how to use it
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Last assumptions revolve around the information system. According to Ackoff a manager doesn’t have to

understand how his information system works, only needs to know how to use it. I am totally in opposition to
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this assumption. It’s the most important duty of manger to have a good understanding of his job. Regardless of
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field of business a manager works in, the manager must have great deal of knowledge and understanding of
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everything working around him. A manger who is only familiar to how to use it and lacks the proper
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understanding of how it works, would means he is working ability is limited to that particular task only.

In such case the manager may fail in responding positively to a situation to which he lacks proper

understanding. At any certain time, any type of trouble can take place and cause a setback and cause

irregularity, and lacking any understanding, the manager will sit there looking for someone to come and assist

him. In the first place, if he knew and understood the system working, he would not lose precious time.

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The Global digital society and Ackoff’s assumptions
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The assumptions that were made fifty years ago by Ackoff regarding erroneous errors in system designs should

be updated to reflect today’s digital and global society. Information system means the collection/compilation,

storage, processing, distribution and making use of information. A suggested procedure to devise an MIS is the

identification of each and every type of managerial decision and its relationship by using decision flow chart.

During designing the systems all managerial functions must get involved as managers from different fields

requires different information and make different decisions. For this purpose different types of information

system should be designed in such a way that it is logical and physical, can detect its deficiencies and provide

relevant information.

There are various information systems, used today for managing each and every activity of business more

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effectively. According to Mason and Swanson (1981) the four categories of management information systems

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are (1) databank information system, (2) predictive information system, (3) decision-making information

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system, and (4) decision-taking information system. The categorization is based on the point of support that the
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information system provides in the procedure of decision making. Information with the same value and

importance should be combined together to prevent the information overload to manager.

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Decision making information system is a computer based system that can be used by manager for acquiring
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needed information to predict an outcome. This system helps together the managers with putting together
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judgement made and computerised information to solve problems. When the manager will have the
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information he wants, he will able to make wise decisions that in turn will increase the performance of an

organisation.
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Office automation for managers such as communication facilities of electronic mail and internet meeting

conference will enable the top level to stay in touch with lower level employees thus providing them proper

direction concerning their goals. Moreover a proper communication channel should be developed among all

levels for avoiding miss communication.

In short MIS is the ultimate solution that is in general should be automated information systems that can be

used within organizations that consist of all organised information and communication channels. An

information system is all essentials in the collection and distribution of data and information required, and more
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regularly than not involves changes in hardware, software, persons, statistics, information and information and

communication channels.

CPA Project Vision 2025 and the Accounting Profession

The American Institute of CPAs initiated a project named as CPA Horizons 2025 for studying trends in

accounting profession. For this purpose 5,600 professionals from the field of accounting were interviewed.

According to the findings, the accounting professionals must keep themselves up to date on the most recent hi-

tech innovations to stay up with the demands of a marketplace driven by technological.

For providing the right document at the right time and in the right format, accounting professionals need

technology skills to meet the changing requirements plus must be always ready for learning new skills.

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However with digitalisation of records there is a threat of document security. CPA Horizons says that

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accountants have got to address Client’s security and privacy concerns and must be in a position to come up

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with improved ways to protect sensitive financial data.
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Accounting educations prepares these professionals for career in accounting but they will need to build up
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technology cleverness constantly to progress in the profession. With the increasing technological changes
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people expects to have updated information available anywhere and at whatever time. This compel financial

reporting to be quicker and, finally, to be send in real-time. The accountant must be in a position of finding
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answers to present investors and stakeholders updated and real-time financial information for increasing

clearness. Accountants should make use of technology to boost speed of analysis and improve decision-making.
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One of the biggest technological trends today is the increase in mobile technology that allows consumers to

access financial information anywhere they want and in real time (Gabriel, 2013). Social media has become as

vital these days as was the business website before. Accounting professional must grip mobile technologies and

social media to refashion and improve communication and collaboration with customers and colleagues.

In the digital world as scam is a lot easier to perform accounting professionals have more accountability to

make certain that information is captured and managed in a protected way. Moreover accounting professional

must stay connected to current business environment and the changes occurring. Increasing globalization will
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have need of accounting professional to gain supplementary awareness about the international marketplace. He

must have great knowledge of other fields of business including finance, economics and technology and must

stay current with strong grip of making use of technology for their advantage for better competence and growth

of services.

Necessary Skills Accounting Should Have

Accounting professional need to develop technology skills in order to be more efficient in his/her field of

expertise. CPA Horizons 2025 said that lifetime education is quite easier now because of the availability of

options in formal and informal learning facilities and mediums, such as webcasts, podcasts and webinars. In

order to provide an excellent service, an accountant need to have deep and up to date knowledge on

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international standards, should be aware of business issues and trends that are arising globally, must have the

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ability and skills of outsourcing locally and globally and create opportunities.

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Along with all these qualities it is most important for an accountant to continue providing excellence in their
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services and always maintain high standards in ever varying situation. Accountants with its brilliance in expert
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area must maintain his/her excellence and must ensure continued acknowledgment as a trusted advisor by
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clients, co-partners, and businesses. The Accountant should stay attentive, helpful and protective and maintain

his/her distinctive role as providers of check and balance service (Audit).

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The most significant role of an accountant is his/her expertise can become very valuable for strategic decisions.

Accounts must have multidisciplinary and incorporated problem solving skills for going beyond conventional
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and non traditional service offerings, and should have the capability and competence of evolving as a strategic
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partner of business and clients. In Short accounting professionals should have a distinctive combination of

human talent, awareness; energetic to surroundings, a trusted advisor, active to changes occurring in technology

for sustaining a competitive advantage in the marketplace for clients.

References
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  Ackoff, R.L.(1967). Management Misinformation Systems, Management Science, 14 (4).

 Cummins, A. (2009, August 1). DO SENIOR MANAGERS REALLY KNOW WHAT THEY WANT?

Retrieved January 14, 2014.

 Gabriel, B. (2013, May 25). CPA Horizons 2025 Says Accounting Professionals Must Be Lifelong,

Retrieved from http://www.businessadministrationinformation.com/news/cpa-horizons-2025-

accounting-professionals-must-be-lifelong-technology-learners

 Mason, R. D., & Swanson, B. E. (1981). Measurements for management decision. Reading, MA:

Addison-Wesley.

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 American Institute of CPAs (2010). CPA HORIZON 2025. Retrieved from

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http://www.aicpa.org/Research/CPAHorizons2025/Pages/CPAHorizonsReport.aspx

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