MANAGEMENT INFORMATION

SYSTEM
MEANING:

Management information system is an acronym

of three words, viz.,

Management
information,
system .
 MANAGEMENT
Management is the art of getting things done
through and with the people in formally
organiZed groups.
Managerial function:

Planning, Organising ,Staffing

Directing and Controlling
 strategicmanagement(top
management)

managementcontrol(middle
management)

operational control(bottommanagement)
 Information:

Information is data that is processed and is

presented in a form which assists decision-
making.

DATA PROCESSING INFORMATION

 System:
A system may be defined as a set of
elements which are joined together to
achieve a common objective. The elements
are interrelated and interdependent.

The three elements of a system are

INPUT PROCESS OUTPUT

 Features of MIS
Data integration: MIS integrates data from
various departments and functions, giving
decision-makers a comprehensive view of
the organization’s data.
Data storage: MIS stores vast data in
databases, making it accessible and
retrievable when needed.
Data processing: MIS processes data to
generate meaningful information. It can
perform calculations, comparisons, and other
data transformations to produce reports and
insights.
User-friendly interface: MIS systems
typically have user-friendly interfaces that
allow non-technical users to access and
interact with data easily.
Customization: MIS systems can be
customized to meet an organization’s
needs. Users can define the type of
information they want to access and how it
is presented.
Real-time information: Many MIS systems
offer real-time or near-real-time data
updates, ensuring decision-makers can
access the most current information to
make timely decisions.
Report generation: MIS generates various
reports, including standard reports, ad-
hoc reports, and exception reports. These
reports help managers monitor
performance and make informed
decisions.
Security: Access to sensitive information is
restricted, and measures are in place to
protect data from unauthorized access or
breaches.
Accessibility: MIS can be accessed
remotely, allowing decision-makers to
retrieve information from various
locations.
Integration with other systems: MIS
systems can integrate with other software
and systems of the organization, such
as ERP (Enterprise Resource Planning)
systems, Customer relationship
management (CRM) systems, Human
capital management (HCM) systems, etc.

Mobile compatibility: Many modern MIS

systems are compatible with mobile
devices, allowing users to access critical
information on the go.
 Requisites of an effective MIS
1.Qualified System and Management Staff
2. System and Computer Experts
3. Management experts
4. Futuristic Perspective
5. Support of Top Management
6. Common Database:A common database may be
defined as a super file which consolidates and integrates data
records formerly stored in a separate data file.
7. Control and maintenance of MIS
 Components of MIS and their
relationship
A management information system is made
up of five major components namely
PEOPLE

BUSINESS
SOFTWARE
PROCESSES

HARDWARE DATA
People: These are the users who use the information system to record
the day to day businesstransactions. The users are usually qualified
professionals such as accountants, human resource
managers, etc.

Business Procedures: these best practices that guide the users and all
other components on how to work efficiently. Business procedures are
developed by the people i.e.users, consultants, etc.

Data: recorded day to day business transactions. For a bank, data is

collected from activities such as deposits, withdrawals, etc.
 Hardware:hardware is made up of the computers, printers,
networking devices, etc. The hardware provides the computing
power for processing data. It also provides networking and
printing capabilities. The hardware speeds up the processing of
data into information.

Software: these are programs that run on the hardware.

System software Application software

 software

System Application
software software

Payroll Banking
windows Mac os ubuntu Sale system
program system
 SUBSYSTEMS OF AN MIS
Two approaches of defining the subsystems
of an MIS are
According to the organizational
functions which they support

According to managerial activities for

which they are used.
 Organizational Function Subsystems

Marketing :Sales forecasting, sales planning, customer

and sales analysis
Manufacturing :Production planning and scheduling,
cost control analysis
Logistics :Planning and control of purchasing, inventories,
distribution
Personnel: Planning personnel requirements,
analyzing performance, salary, administration
Finance and accounting: Financial analysis, cost
analysis, Capital requirements planning, income measurement
Information processing: Information system
planning, cost-effectiveness analysis
Top management :Strategic planning, resource
allocation
 Managerial activities
Transaction processing: Processing of orders,
shipments, and receipts
Operational control: Scheduling of activities and
performance reports
Management control :Formulation of budgets and
resource allocation
Strategic planning : Formulation of objectives and
strategic
 ROLE OF MANAGEMENT INFORMATION
SYSTEM
The system ensures that an appropriate
data is collected from the various sources,
processed and send further to all the
needy destinations.

1.Decision-making
2. Problem solving

3. Planning
4. Improves business efficiency

5. Helps in coordination among the

department
 What Is Corporate Planning?

A process that is used by businesses to

map out a course of action to
grow, increase profits, gain exposure, or
strengthen brand identity. Corporate
planning is a tool that successful business
use to leverage their resources more
wisely than their competitors.
Corporate planning for MIS
Gather Information

Set objectives of the plan

Devise strategies to meet goals

Implement your plan

Monitor plan performance

Evaluate the effectiveness/success of your plan

 Growth of MIS in an
organisation
it can process and interpret massive
amounts of data from multiple sources
and generate detailed reports that
companies can use to make informed
business decisions.
Needs Assessment

Planning and Design

Data Collection and Integration

Database Development

System Development

Testing and Quality Assurance

Implementation and Deployment

Monitoring and Maintenance

Continuous Improvement
 Centralisation Vs Decentralisation
Should we centralize or decentralize
information systems to create greater
support to different business processes?

To develop one common system for an

organization is of course a centralized
approach.
 Centralization of authority means the power of planning and
decision making are exclusively in the hands of top
management. It alludes to the concentration of all the powers
at the apex level.

Reservation of decision making power at top level.

Reservation of operating authority with the middle level

managers.

• Reservation of operation at lower level at the directions of the top level.

Decentralization refers to the dissemination of powers by the
top management to the middle or low-level management. It is
the delegation of authority, at all the levels of management.
Centralization and decentralization are the categories by which
the pattern of authority- relationships becomes clear. The
degree of centralization and de-centralization can be affected
by many factors like nature of operation, volume of profits,
number of departments, size of a concern, etc. The larger the
size of a concern, a decentralization set up is suitable in it.

BASIS FOR CENTRALIZATION DECENTRALIZATION

COMPARISON

Meaning The retention of powers and The dissemination of authority,

authority with respect to responsibility and accountability
planning and decisions, with to the various management
the top management, is levels, is known as
known asCentralization. Decentralization.
Involves Systematic and Systematic dispersal of authority.
consistent
reservation of authority.

Communicati Vertical Open and Free

on Flow

Decision Slow Comparatively faster

Making

Advantage Proper coordination Sharing of burden and

andLeadership responsibility

Power of Lies with the top management. Multiple persons have the power
decision of decision making.
making

Implemen Inadequate control Considerable control

ted when over the over the
organization organization

Best suited for Small sized organization Large sized organization

Limitations of MIS
MIS cannot take the place of managerial decisions. It is
merely a valuable method for top-level executives in
making decisions and solving problems.
2 .MIS can be considered mainly for quantitative factors.
3. An MIS does have limitations, like its developing cost,
employee training time, lack of versatility, and the storage of
incorrect or incomplete data.
4. Only those employees who have been educated and well
trained are able to work on MIS, hence the employees who are
not educated cannot work with MIS.
5. Depending on the MIS style and functionality, changing
business operations can be impossible.
6. provides inaccurate or incomplete information to the
management executives.
 Management Information System (MIS) Models
A model is an abstraction of something it
represents
 • Define the problem and the factor that
influence it.
• Select criteria to guide the decision and
establish objectives.
• Formulate a model that helps
management to understand the
Steps of relationships between the influence
Model factors and the objectives the firm is
trying to achieve.
Construction: • Collect the relevant data while trying to
avoid the incorporation of superfluous
information into the model.
• Identify and evaluate the alternatives.
• Select the best alternative.
• Implement the alternative.
 Components of MIS Model:
Organizational Problem Solvers:
Outputs are used by persons who are responsible for solving the
firm’s problems(say managers).
2. Database:
It’s contents are used by software that produces report as well as
mathematical model.
3. Mathematical Model:
It produces information as a simulation of firm’s operation.
4. Report Writing Software:
It produces both periodic and special report.
5. Environment:
The environment is of great importance to the firm. It is the very
reason of the firm’s existence.
 Subsystems of the Management
Information System:
Systems may consist of numerous sub-systems. Subsystems
perform specialized tasks related to the overall objectives of
the total system.

Transaction Processing System

Management Reporting System
Decision Support System
Office Information System
Business Expert System