Chapter-One: Overview of Management Information Systems

Learning objectives
Definition of MIS
Evolution of MIS
Functions of MIS
 Characteristics of MIS
Subsystems of MIS
Role of MIS in Business Organizations
Components of an Information Systems
 Contemporary approaches to information systems
 Information Technology Concepts
The Role of Information Systems in Organization
 1.1 What Is Management Information Systems?

• Before explaining management information systems,

the terms systems, information, and management needs
to be clear.
• A system is a combination or arrangement of parts to
form an integrated whole. A system includes an orderly
arrangement according to some common principles or
rules. A system is a plan or method of doing something.
• A system is a scientific method of inquiry, that is,
observation, the formulation of an idea, the testing of
that idea, and the application of the results. The
scientific method of problem solving is systems analysis
in its broadest sense.
 What Is MIS?

• Data are facts and figures. However, data have no

value until they are compiled into a system and can
provide information for decision making.
• Information is processed, organized and structured
data. It provides context for data and enables decision
making process
• Information is what is used in the act of informing or
the state of being informed. Information includes
knowledge acquired by some means.
 What Is MIS?
• Management is the process of allocating an organization's
inputs, including human and economic resources, by planning,
organizing, directing, and controlling for the purpose of
producing goods or services desired by customers so that
organizational objectives are accomplished.
• Management information systems are those systems that allow
managers to make decisions for the successful operation of
businesses. Management information systems consist of
computer resources, people, and procedures used in the modern
business enterprise.

• The goal of the MIS organization is to deliver information

systems to the various levels of corporate managers.
 Information system
An information system (IS) is a formal, sociotechnical,
organizational system designed to collect, process, store,
and distribute information.
Several components work together to add value to an
organization:
1. Hardware
2. Software
3. Data
4. People
5. Process
 Importance of MIS

• MIS helps the management at various levels and it is a

means of communication where data are collected,
processed, stored and retrieved later for making
decisions regarding planning, operation and control of
an organization.
• Decision making is an important requirement in every
organization wherein there are different types of
information obtained from different functional areas of
management like finance, marketing, production,
planning and control etc.
• Each levels of organization needs information systems.
The specific needs vary from level to level.
• Information systems exist, because they provide organizations
with a competitive advantage.
• Information systems are the key to the organizations’ ability
to provide greater and better quality service.
• Layers of Management and Use of Information:
• top level – 3: The non – programmed decision making
processes are found here that are required to design and
redesign the entire system, to provide it with its basic goals
and objectives and to monitor its performance.
• Middle level – 2: It has the programmed decision making
processes. The processes that govern the day – to – day
operations of the manufacturing and distribution system.
• Functional level-1: Here, the processes procure raw
materials, manufacture the physical product, store them in
warehouses and ship it.
 1.3 EVOLUTION OF MIS

• Information system is as old as recorded human history.

Information system moved fast towards the growth track
in the last few centuries.
• The industrial revolution gave it a big fillip. Thereafter,
business started growing and along with growth, business
complexity also increased.
• More commercial legislations were enacted to bring
control over business and industry.
• MIS, organization size, development of computing
technology among others have ensured the fast growth of
information systems during the last few centuries.
• When all businesses were mostly local and small in
operations, a single individual performed all activities on
his own. There was practically no need for record-keeping.
He knew how much of stock he had, how much surplus he
had made etc.
• But over few years, business grew in size and complexity;
from sole trading firms to global corporations, from one or
two commodities to several thousand products, from
localized operations to global operations, with production
facilities and wide marketing in many countries.
• The chief executive of such a big corporation has to depend
on reports, mostly periodic paper report, for information. It
is impossible for him to visit all his corporation’s facilities,
plants and warehouses etc. and observe things for himself.
• Another notable contribution to MIS came from
Management Science, which is the application of
mathematical and statistical tools, and technique solving
problems.
• This emerged at the time of World War – II, when many
statistical tools were designed, tested and successfully
employed in military warfare, since then, it has
astronomical growth in the present century.
• Growth in computing technology made modern MIS
possible. The speed, accuracy and the relevant facility in
computers, also made it a pivot in modern MIS.
Revolutionary changes are also taking place in
Information Technology, which facilitated rapid growth
of MIS.
Evolution of Various Computer Based Information Systems
1. Electronic Data Processing Systems (EDPS) 1950s – 1960s.
• (Including transaction processing, record keeping, accounting and other EDP
applications)
2. Management Reporting Systems (MRS) 1960s – 1970s.
• Management Information Systems (MIS) (Management reports of pre-specified
information to support decision making)
3. Decision Support Systems (DSS) 1970s – 1980s
• Decision Support Systems (DSS) (Interactive and ad hoc support of the managerial
decision making process)
4. Strategic End User Support Systems (SEUSS) 1980s – 1990s
• End User Computing Systems (Direct computing support for end user productivity
and work group collaboration)
• Executive Information Systems (EIS) (Vital information for top management)
• Expert Systems (Knowledge based expert advice for end users)
• Strategic Information Systems (SIS) (Strategic products and services for
competitive advantage)
5. Enterprise and Global Internet Working (EGIW) 1990s – 2000s
• Internet worked information system.
 1.3 Characteristics of MIS
The characteristics of MIS are as follows:
1. MIS is Management Oriented:
The design of MIS takes care of the managers, who meet the information
requirements. The development of the information system starts after deciding the
management needs and keeping in view the overall objectives of the management.
2. Management Directed:
Since, MIS requires heavy planning and investment. Management is deeply
involved in the design, implementation and maintenance of the system.
3. Integrated System:
5 Ms – Men, Money, Material, Machines and Methods are the basic resources of
management and is recognized as an important factor and its effective use
contributes to the success of the management. MIS is the “Catalyst and Nerve
Centre” of an organization. It has a number of subsystems. In order to make these
subsystems effective, it becomes necessary that they have to be viewed as an
integrated system, so that the result is balanced.
4. Avoids Redundancy in Data Storage:
Since, MIS is an integrated system, it avoids unnecessary duplication and
redundancy in data gathering and storage.
5. Common Data Flow:
• To achieve the objective of integration and to avoid duplication and redundancy in
data gathering, storage and retrieval, data capturing is usually confined to original
sources and it is done only once. Common data flow tries to utilize minimum data
processing effort and strives to minimize the number of output documents and
reports. This type of integration can avoid duplication, simply operations and
produce an effective MIS.
6. Heavy Planning Element:
• Design and implementation of MIS require detailed and meticulous planning of such
activities as acquisition and deployment of hardware, software, human ware, data
processing operations, so that effective implementation of each subsystem is possible
at a time.
7. Subsystem Concept:
• MIS gives provision for breaking into various subsystems based on the activity as
well as the functions of the organization, so that effective implementation of each
subsystem is possible at a time.
8. Common Database:
• It acts as a master that holds the functional subsystems together. It achieves this aim
by allowing access to different master files of data to several functional subsystems.
Data requirements for different levels of management also support the need of more
than one database, unique database and common database.
9. Flexibility and Ease of Use:
• MIS has been designed flexible enough to
accommodate new requirements. The system is easy
to operate so that not much computer skills are
required on the part of the user to access database for
information or for carrying out special analysis of
data.
10. Computerization:
• MIS can be computerized because of its nature as a
comprehensive system. This provides speed in
creating and accessing files, accuracy, consistency in
data processing, reduction in clerical work, avoid
human errors etc.
1.4 Functions of MIS
• Management information system is a combination of computers and
procedures for providing information that managers use in making decisions.
1. Collect Data:
• Data important to the operations of the organization are gathered from both
external and internal sources. Generally, most of data collected for an MIS
come from internal sources such as company records or reports and
information compiled by managers themselves. External sources include
publications, customers and consultants.
2. Store and Process Data:
• The data is inputted and stored in databases. And this data is transformed into
useful information through the application of computer software programs
and judgments made by technical support staff and other system users.
3. Presents Information to Managers:.
• This useful information is retrieved as needed by the management and
technical personnel and applied to a wide variety of decisions related to the
conduct of organizational operations
 1.5 Sub Systems of Information System
The sub systems of information systems can be
categorized into two groups. That are.

INFORMATION SYSTEMS

MANAGEMENT SUPPORT SYSTEMS OPERATIONS SUPPORT SYSTEMS

MIS DSS EIS PCS TPS ECS

MANAGEMENT SUPPORT SYSTEMS: (MSS)
• MSS is an information system that provides information to
support managerial decision making.
• MSS is divided into three types. Those are:
1. Management Information System (MIS)
• It provides information in the form of reports and displays to
managers and many business professional to support business
decision making.
2. Decision Support System (DSS)
• It provides interactive and ad-hoc support for the decision
making process of managers and other business professionals.
3. Executive Information System (EIS)
• It provides critical information from many sources tailored to
the information needs of executives.
OPERATIONS SUPPORT SYSTEMS: (OSS)
• Information systems needed to process data generated
by and used in business operations are “Operations
Support System”.
• OSS collects, processes and stores data generated by
the operations systems of an organization and
produces data and information for input into a MIS or
for the control of an operations system.
• Operation support systems are three types. That are:
1)Transaction Processing System (TPS)
• TPS record and process data resulting from business transactions. Transactions are
processed in two basic ways.
Online Batch Transaction Processing
• In this transactions data are accumulated over a period of time and processed
periodically.
• Ex: Bank Transaction Processing.
Online Real-time Transaction Processing
• In this data are processed immediately after a transaction occurs.
• Ex: Retail Store Processing.
2.)Process Control System (PCS)
• PCS monitor and control physical processes.
• Ex: Petrol Refinery, Steel Factory.
3)Enterprise Collaboration System (ECS)
• ECS enhance team and work group communications and productivity. It is also
known as Office Automation System.
• Ex: Video Conferencing, Intercom, E – Mail, etc
 1.6 Approaches of Information Systems

The information systems deals with issues and insights contributed from technical and
behavioral disciplines.
1.) Technical approach emphasizes mathematically based, normative models to study
information systems, as well as the physical technology and formal capabilities of the
systems.
• The disciplines are involved are:
i. Computer Science, which is concerned with:
• Establishing theories of computability.
• Methods of computation.
• Methods of efficient data storage and access.
 ii. Management Science deals with:
• The development of models for management practices.
iii. Operations Research, which is concerned with:
• Mathematical techniques and models for optimizing selected parameters of
organizations such as Assignment, Transportation, Inventory Control and Transaction
costs.
2.) Behavioral approach is a growing part of the information systems field
concerned with behavioral problems and issues. It can be system utilization,
implementation and creative design totally different from technical approach.
• The disciplines involved are:
i. Sociology focuses on the impact of information system on
• Groups
• Organization and
• Society
ii. Political Science investigates the political impacts and uses of information
systems.
iii. Psychology is concerned with
• Individuals responses to information systems
• Cognitive models of human reasoning.

The behavioral approach does not ignore technology. Information systems

technology is the stimulus for a behavioral problem. It concentrates rather on
changes in attitudes, management and organizational policy and behavior.
 1.7 Information Technology Concepts
1) Information Technology (It)

• IT is the combination of the hardware, software, telecommunication, database

management and other information processing technologies used in computer –

based information system.

• Advanced in personal computing, hardware and software package,

telecommunications, database processing, office automation systems, decision

support system, executive information systems have been responsible for this

development.

• The people, tasks, technology, culture and structure of an organization affect how it

will organize the delivery of information systems technology.

2) Multimedia:
• Multimedia is a form of communication that combines
different content forms such as text, audio, images,
animations, or video into a single interactive
presentation, in contrast to traditional mass media which
featured little to no interaction from users, such as
printed material or audio recordings.
• Text, image, audio, video, and animation are the five
multimedia elements Presented through face book,
YouTube, TV sets, emails, telegram, twitter, instagaram
etc…
Examples of Multimedia
3) INTERLEAVING TECHNIQUES:
Interleaving is a learning technique that involves mixing together
different topics or forms of practice, in order to facilitate learning. The
following are the interleaving techniques.
1. Multi Programming:
• It is used in multiuser operations, is a process in which the computer
works on two or more programs concurrently. It will work on one
program for a while, switch to another program, they third program and
so on.
2. Multi Tasking:
• It refers to the operating system’s ability to execute two or more of
single user’s task concurrently. Single user operating systems are
traditionally the most common type of micro-computers.
• It allows the user to work on one task at a time whereas for micro –
computers, multi – task operating system provides single users with
multi programming capabilities.
• Ex: Windows, Linux etc.
3. Time Sharing:
• Time sharing is a very popular technique, which allows a CPU to
simultaneously support activities of several terminal users.
• It allocates small, fixed time slot to users at the terminal as their jobs
are being processed.
4. Virtual Memory:
• Programs stored on disk are broken up into fixed length pages. When a
program is under process, the first few pages of it are brought into
primary memory. Then, the computer starts processing the program. If
the computer wants a page it doesn’t have, it brings that page in from
secondary storage and overwrites it on to the memory location
occupied by a page it no longer needs.
5.Multi – Processing: (Parallel Processing)
• It refers to the use of two or more CPUs linked together, to perform
coordinated work simultaneously.
• Multi – processing involves handling several parts of the same
program simultaneously on several CPUs
 1.8 The Role of Information Systems in Organization

The information system play the following roles in the organization

 The Widening Scope of Information Systems
 The Network Revolution and the Internet
 New Options for Organizational Design: The Networked Enterprise
 Flattening Organizations
 Separating work from location
 Reorganizing work flows
 Increasing flexibility of organizations
 The changing management process
 Redefining organizational boundaries
 Electronic Commerce and Electronic Business

.
 Class End Discussion Questions

1) What is MIS
2) What are 5Ms in MIS
3) Difference b/n Data and information
4) The two sub systems of information systems
5) Approaches of Information Systems
6) Role of Information Systems in organization

Chapter 1 32
 The end of chapter One

Thank You For Coming!