Lecture-4

Information Systems Management/Management Information System,

(ISM/MIS)
Course ID: BBA-305
COMPONENTS OF MIS
 MIS is a system which take data as input and processed
it to give relevant information that can help the
management of an organisation to take correct decision
and further for strategic planning today the reason for
that most organisation implement the MIS is to achieve
the goals of an organisation in the given time face all
components of MIS must support for the same.
COMPONENTS OF MIS

All of these
components must
work together to
achieve business
objects.
COMPONENTS OF MIS AND THEIR
RELATIONSHIP
 A management information system is made up of five major
components namely people, business processes, data, hardware,
and software. All of these components must work together to
achieve business objects.
 People – these are the users who use the information system to
record the day to day business transactions. The users are usually
qualified professionals such as accountants, human resource
managers, etc. The ICT department usually has the support staff
who ensure that the system is running properly.
 Business Procedures – these are agreed upon 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 – the recorded day to day business transactions. For a bank,
data is collected from activities such as deposits, withdrawals, etc.
COMPONENTS OF MIS AND THEIR
RELATIONSHIP
 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.
The software is broken down into two major categories
namely system software and applications software.
System software refers to the operating system i.e.
Windows, Mac OS, and Ubuntu, etc. Applications
software refers to specialized software for accomplishing
business tasks such as a Payroll program, banking
system, point of sale system, etc.
MIS APPLICATIONS IN BUSINESS
 Management Information Systems are typically
developed and organized around the major functional
areas of an organization.
 Typically, functional areas of an organization include
finances, human resources, marketing, etc.
 Many of these functional areas are operated by their own
Management Information System, or MIS.
 Let us give a look to the major functional areas of
business through the diagram.
MAJOR BUSINESS FUNCTIONS
 The principal business functions in a business firm are:
 Marketing and sales: Marketing activities are directed
toward planning, promoting, and selling goods and services
to satisfy the needs of customers and the objectives of the
organization.
 Marketing information systems support decision making
regarding the marketing mix. These include:
 Product
 Price

 Place

 Promotion
MAJOR BUSINESS FUNCTIONS
 Production: Global competitive pressures of the
information society have been highly pronounced in
manufacturing and have radically changed it. The new
marketplace calls for manufacturing that are:
 Lean - highly efficient, using fewer input resources in
production through better engineering and through production
processes that rely on low inventories and result in less waste.
 Agile - fit for time-based competition. Both the new product
design and order fulfilment are drastically shortened.
 Flexible - able to adjust the product to a customer's preferences
rapidly and cost effectively.
 Managed for quality - by measuring quality throughout the
production process and following world standards,
manufacturers treat quality as a necessity and not a high-price
option.
MAJOR BUSINESS FUNCTIONS
 Accounting and finance: The financial function of the
enterprise consists in taking stock of the flows of money
and other assets into and out of an organization, ensuring
that its available resources are properly used and that the
organization is financially fit. The components of the
accounting system include:
 Accounts receivable records
 Accounts payable records
 Payroll records
 Inventory control records
 General ledgers
CONTINUE….
 Financial information systems rely on external sources, such
as on-line databases and custom produced reports, particularly
in the areas of financial forecasting and funds management.
The essential functions that financial information systems
perform include:
 Financial forecasting and planning
 Financial control
 Funds management
 Internal auditing
MAJOR BUSINESS FUNCTIONS
 Human resources: A human resource information system (HRIS)
supports the human resources function of an organization with
information. The name of this function reflects the recognition that
people who work in a firm are frequently its most valuable
resources. The complexity of human resource management has
grown immensely over recent years, primary due to the need to
conform with new laws and regulations.
 A HRIS has to ensure the appropriate degree of access to a great
variety of internal stakeholders, including:
 The employees of the Human Resources department in
performance of their duties
 All the employees of the firm wishing ti inspect their own
records
 All the employees of the firm seeking information regarding
open positions or available benefit plans
CONTINUE….
 Employees availing themselves of the computer-assisted training
and evaluation opportunities
 Managers throughout the firm in the process of evaluating their
subordinates and making personnel decisions
 Corporate executives involved in tactical and strategic planning
and control