Management Information System: Semester 3

MANAGEMENT INFORMATION SYSTEM
SEMESTER 3
MBA
KANNUR
UNIVERSITY
Prepared by THOMAS JOHN VJIM

MANAGEMENT INFORMATION SYSTEM
System
Management Information • Set of inter-related
• Planning • Information is data that is
• Organizing components with a clearly
processed and is presented
• Staffing defined boundary working
in a form which assists
• Directing Controlling together to achieve a
decision-making
common goal.

WHAT IS MIS?
MIS is a subset of
Information Systems (IS)
and is primarily focused on
managing and processing
data and information related
to the operations,
performance, and decision-
making needs of an
organization.
What Is Information Systems?
Information Systems (IS) refer to the combination of

people, processes, technologies, and data used to
gather, process, store, and distribute information for
various purposes within an organization.

Management Information System
A Management Information
System (MIS) is a computerized
information system that provides
managers and decision-makers
with the tools and information
they need to support and enhance
their decision-making processes
within an organization.

Management Information System

Need for MIS?
1. Decision-making support
2. Data Analysis
3. Improved Efficiency
4. Resource Allocation
5. Performance Monitoring
6. Customer Relationship Management
7. Forecasting
Fundamentals of Information System in Business
1.Data: Data is the raw

information collected and
stored by businesses.
It can include customer records,
sales figures, inventory levels,
and more.
Data is the starting point for
information systems.
2. Information: Information is
data that has been processed,
organized, and analyzed to
make it meaningful and useful
for decision-making.
Information is derived from
data through various processes.

3. Hardware: Hardware
components such as computers,
servers, storage devices, and
network infrastructure are
essential for processing and
storing data.
They form the physical
infrastructure of information
systems.
4. Software: Software includes

the applications, operating
systems, and programs that run
on hardware and enable users to
interact with data and perform
specific tasks.

5.Database: Databases are

structured repositories for storing
and managing data.
They allow businesses to organize,
access, and manipulate data
efficiently.
Relational databases, NoSQL
databases, and data warehouses are
common types.
6. Networks: Networks connect
hardware and software
components, enabling data to
flow between different parts of
the information system.
Local area networks (LANs),
wide area networks (WANs),
and the internet play crucial
roles in business information
systems.
7. People: People are a vital
component of information
systems.
Users interact with hardware and
software to input, retrieve, and
analyze data.
IT professionals design, maintain,
and troubleshoot systems, and
management uses information
systems for decision-making.
8. Procedures: Procedures
mean rules which govern how
an operation is performed in
information system.
"Procedures are for people
what software is for hardware”

Types of Information Systems in Business
Information Systems
Operations Support System
Transaction Processing System (TPS)
Process Control Systems
Enterprise Collaboration System
Management Support Systems
Management Information System (MIS)
Decision Support System
Executive Information System

Operation Support Systems
Definition:
Information systems that process data generated by and
used in business.
Goal:
To efficiently process business transactions, control
industrial processes, support enterprise
communications and collaboration, and update
corporate databases.
Operation Support Systems
•Monitors and manages information system network
•Processes business transactions
•Control Industrial process
•Support enterprise communications
•Support enterprise collaborations
•Update corporate database
•Supports customer service

Process data resulting from business transactions,
update operational databases and produce business
documents.
It has four components:
•Storage
•Processing System
•Inputs
•Outputs
They process transactions in two different ways:

batch processing and in real-time online processing.
Batch processing: transaction data are accumulated
over a time and processed periodically. (transactions in
batches)
Real-time (online) processing: data are processed
immediately after a transaction is occurred. (one at a
time)
The point of sale (PoS) systems

at many retail stores use
electronic cash register terminals
to capture and transmit data
electronically over
telecommunication links to
regional computer centres for
immediate (real-time) processing
or nightly (batch) processing.
Process Control System
To monitor and control physical processes.

Process control systems (PCS), sometimes called
industrial control systems (ICS), function as pieces of
equipment along the production line
during manufacturing that test the process in a variety
of ways, and return data for monitoring and
troubleshooting.

Enterprise Collaboration System
It enhances team and workgroup communications and

productivity and include applications that are
sometimes called office automation systems.
Examples are e-mails, video conferences, etc. used in a
project team.

Management Support Systems (MSS)
Management support systems (MSS) provides

information for effective decision making by managers.
MSS provides information to managers in the form of
reports and displays to managers and many business
professionals.

Management Support Systems (MSS)
Decision support systems (DSS) give direct computer

support to managers to make decisions.
An advertising manager may use a DSS to perform
what-if-analysis on how to spend the advertising
money.
A production manager may use a DSS how much
product to manufacture. Based on the expected sales
and future market information.
Executive Information System (EIS)
Executive information system (EIS) provides critical

information from a wide variety of external and internal
sources in easy-to-use displays to executives and
managers.
The top officials may use touch screen terminals to
view instantly text and graphics displays that highlight
key areas of organisational and competitive
performance.
Other classifications of information systems
• Expert Systems:
Provides expert advice in diagnostics, decisions for
portfolio management, etc.
• Knowledge management systems:
Knowledge- based information systems that create,
organise and disseminate business knowledge to
employees
Other classifications of information systems
•Functional business systems:

Focus on business operations and managerial functions
of accounting, marketing, etc.
•Strategic information systems:
Applies information technology in firms products,
services or business processes to gain strategic
advantage over rivals.
Systems Approach to Problem Solving
A systems approach in problem solving is a holistic and

interdisciplinary methodology that views complex
issues as interconnected systems rather than isolated
components.
It aims to understand how changes in one part of the
system can impact the entire system.

Principles of Systems Approach
1. Systems Thinking: It
involves looking at the "big
Feedback loop is a process
picture" and considering the in which the outputs of a
entire system, including its system are circled back and
components, processes, and used as inputs.
In business, this refers to the
feedback loops. process of using customer or
It helps identify how different employee feedback to create
a better product or
parts of the system influence workplace.
one another.
2. Interdisciplinary Perspective
A systems approach often involves collaboration among
experts from various disciplines to bring a
comprehensive understanding to complex problems.
3. Feedback Loops
Understanding the feedback mechanisms within a
system is crucial.
Positive feedback amplifies changes, while negative
feedback tends to stabilize or regulate the system.
4. Cause-and-Effect Relationships
Identifying causal relationships within the system is
fundamental to understanding how changes or
interventions can affect outcomes.
5. Continuous Learning and Adaptation
A systems approach recognizes that complex problems
may require ongoing assessment and adaptation of
solutions as the system evolves.

6. Ethical Considerations
It considers ethical and social aspects of the problem, as
well as the potential unintended consequences of
interventions.
7. Stakeholder Involvement
Engaging stakeholders and considering their
perspectives is crucial in problem solving within a
systems approach, as it helps account for diverse
viewpoints and interests.
Steps in Systems Approach
Define the Identify
Alternative
Problem Solutions
Evaluate
Alternative
Solutions
Select the Best Implement

Alternative Prepared by THOMAS JOHN VJIM
the Solution
UNIT II - Business Information Systems
Business Information Systems – Marketing

Information Systems – Manufacturing
Information Systems–Human Resource
Information Systems –Accounting Information
Systems, Financial Information Systems –
Transaction Processing System.

UNIT II - Business Information Systems
Business Information Systems are the information

systems used for business decision making.
All the information systems for business decision
making comprise those in the functional areas of
business.

Business Information Systems
Marketing Information systems

Manufacturing Information systems
Human resource Information systems
Accounting Information systems
Financial Information systems
Transaction Processing systems
Marketing Information Systems
A Marketing Information System (MIS) is a

system used by businesses to collect, process,
and analyze information relevant to their
marketing activities.
Timely and accurate information about the market,
customers, competitors, and other factors
influencing marketing strategies.
1. Marketing Information Systems
Marketing information allows the managers to
make decisions on
product development, product improvement,
pricing, packaging, distribution,
consumer satisfaction, customer service,
media selection, sales promotion and other
activities related to sales and marketing.

Components - Marketing Information Systems
1. Data collection – from internal and external

2. Data Processing – raw data to information
3. Information Storage – in structured manner to
analyse when needed
4. Information Analysis – identify trends and pattern
5. Information Dissemination – communicate the
findings
6. Feedback – to improve data quality
Uses - Marketing Information Systems
• Gathering data on market trends, customer
Market Research preferences, and competitor activities.
Product Development • Assessing customer needs and preferences

• Evaluating the effectiveness of advertising
Advertising & Promotion
campaigns and promotional activities.
Predicting future sales based on historical data and
Sales Forecasting market trends.
Customer Relationship To enhance relationship with customers by managing
Management (CRM) and analyzing data
Monitor and analyse competitor strategies and
Competitor Analysis performance
2. Manufacturing Information Systems
A Manufacturing Information System (MIS) is

a computerized system that manages and
processes information related to manufacturing
processes within an organization.

2. Manufacturing Information Systems
It helps in planning, executing, and controlling the

production operations.
MIS integrates various aspects of manufacturing,

such as production planning, scheduling,
inventory management, quality control, and
maintenance.
Components - Manufacturing Information Systems
Enterprise • Integrate various business Processes.
Resource • Eg: SAP ERP, Microsoft Dynamics 365 (Finance),
Oracle E-business Suit (SCM)
Planning (ERP)
Production • Creating production plans, scheduling work orders
Planning & etc.
• Eg; Advanced Planning & Scheduling (APS)
Scheduling
• Tracking and managing inventory levels for
Inventory efficient production.
Management • Eg: Just-In-Time (JIT) inventory Management

Components - Manufacturing Information Systems
• Monitor and control quality of products through

Quality Control statistical process control and quality assurance.
• MIS facilitates the coordination and integration of

Supply Chain the entire supply chain, from raw material
Management suppliers to end customers.
• MIS provides tools for analyzing and reporting

Data Analytics & manufacturing data to support decision-making.
Reporting • Eg: Business Intelligence (BI) tools

3. Human Resource Information Systems
A Human Resource Information System

(HRIS) is a software or online solution that
automates and manages various HR functions
within an organization.
It serves as a centralized database that helps HR
professionals store, manage, and retrieve
employee information.
Features of HRIS
1. Employee Information Management

HRIS systems typically store and manage basic
employee information such as contact details,
employment history, skills, qualifications, and
performance data.
Eg: Workday, BambooHR, SAP SuccessFactors.

Features of HRIS
2. Recruitment and Applicant Tracking

HRIS systems often include modules for
managing the recruitment process, from posting
job openings to tracking applicants and managing
the hiring workflow.
Eg: Greenhouse, iCIMS, Lever.

Features of HRIS
3. Time and Attendance Management

HRIS systems can track employee working hours,
attendance, and leave balances.
Eg: Kronos, ADP Workforce Now, BambooHR.

Features of HRIS
4. Benefits Administration
HRIS systems help manage employee benefits,
including enrollment, tracking, and
administration.
Eg: Gusto, Zenefits, Namely.

Features of HRIS
5. Performance Management
HRIS systems may include tools for setting and
tracking employee goals, conducting performance
reviews, and managing feedback.
Eg: 15Five, Halogen, Cornerstone OnDemand

Features of HRIS
6. Payroll Integration
Many HRIS systems integrate with payroll
software to streamline the payroll process and
ensure accurate compensation.
Eg: ADP, Paychex, Gusto

Features of HRIS
7. Analytics and Reporting

HRIS systems often provide reporting and
analytics tools to help HR professionals make
data-driven decisions.
Eg: Tableau, SAP Analytics Cloud, Visier

Features of HRIS
8. Employee Self-Service Portals

HRIS systems may include employee self-service
portals, allowing employees to update personal
information, view pay stubs, and access other HR-
related information.
Eg: PeopleSoft, BambooHR, ADP Workforce Now

4. Accounting Information Systems
An Accounting Information System (AIS) is a system

that collects, stores, manages, and processes financial
and accounting data to support decision-making within
an organization.
The primary purpose of an AIS is to provide relevant
and timely financial information to internal and external
users for decision-making.

Features of Accounting Information Systems
1. Data Input :- This involves the collection and input

of financial transactions into the system. Transactions
can include sales, purchases, payroll, and other financial
activities.
Sales transactions, purchase orders, inventory
movements, employee payroll data etc. through
Point of Sale terminals, online sales transactions and
manual data entry
2. Data Storage:- The system stores the collected data

in a structured manner. Databases are commonly used to
organize and store financial information securely.
The AIS stores this data in a centralized database,

organized by categories such as sales, purchases, and
expenses.

3. Data Processing:- The system processes the data to
generate meaningful information.
This includes activities such as calculations, sorting,
summarizing, and categorizing financial data.
The system processes the data to calculate total sales,

expenses, and profits. It also updates inventory levels
and computes payroll.

4. Data Output:- The processed information is
presented to users in the form of financial statements,
reports, and other relevant outputs.
Financial statements, such as income statements and

balance sheets, are generated to provide a snapshot of
the business's financial health.
Reports on sales trends, inventory levels, and other key
metrics are also produced.
5. Internal Controls:- AIS incorporates internal
controls to ensure the accuracy, reliability, and security
of financial data. This includes measures to prevent and
detect errors and fraud.
The AIS includes security measures to protect sensitive

financial information, as well as checks and balances to
ensure accuracy in data entry and processing.

6. Feedback:- Users can provide feedback on the

information generated by the AIS, helping to improve
the system's accuracy and relevance over time.
Management reviews the financial reports and may

provide feedback to improve the accuracy and relevance
of the information generated by the AIS.

Financial Information Systems (FIS)
Financial Information Systems (FIS) refer to a set of

software and informational technologies designed to
support and streamline the financial operations and
management of an organization.
Managing financial transactions, generating financial
reports, and facilitating decision-making processes
related to an organization's finances.

Functions of Financial Information Systems (FIS)
1.Accounting Systems: FIS often includes accounting

modules that help in recording financial transactions,
maintaining ledgers, and ensuring compliance with
accounting principles and standards.
2.Financial Reporting
FIS generates various financial reports such as income
statements, balance sheets, cash flow statements etc.

3. Budgeting and Forecasting
These systems assist in the preparation of budgets and
financial forecasts. They help organizations plan and
allocate resources effectively.
4. Financial Analysis
FIS provides tools for financial analysis, enabling
organizations to assess their performance, profitability,
and financial trends over time.

5. Risk Management
Many FIS incorporate features to identify, assess, and
manage financial risks, including market risk, credit
risk, and operational risk.
6. Transaction Processing
FIS facilitate the processing of financial transactions,
including payments, receipts, and other financial
activities.

7. Integration with Other Systems

FIS may integrate with other organizational systems,
such as Enterprise Resource Planning (ERP) systems, to
ensure seamless flow of information across different
departments.

Transaction Processing Systems (TPS)
Transaction Processing Systems (TPS) are designed

to process, record, and manage day-to-day business
transactions.
These systems play a fundamental role in organizations
by capturing, processing, and storing transaction data,
which are the basic activities that occur in the course of
conducting business.

Features of Transaction Processing Systems (TPS)
1. Data Entry and Processing

TPS are responsible for capturing and recording
transactional data, such as sales, purchases, payments,
and receipts. This data is then processed to update
relevant databases and produce necessary outputs.

2. Real-time Processing
TPS often operate in real-time, meaning that
transactions are processed immediately as they occur.
This is crucial for businesses that require up-to-the-
minute information for decision-making

3. Batch Processing
While real-time processing is common, some TPS also
use batch processing, where transactions are collected
over a period and processed together in a batch.

4. Database Management
TPS update and maintain databases that store
transactional data. This data can be accessed and used
by other systems within the organization, such as
management information systems and decision support
systems.

5. Scalability
TPS are designed to handle a large volume of
transactions. As businesses grow, the TPS should be
able to scale to accommodate increased transaction
loads.
6. Interfaces with Other systems
TPS often interface with other systems in the
organization, such as financial systems, inventory
management systems, and human resources systems
UNIT III
Management Information & Decision Support Systems

– Management Information Systems –Expert Systems
Examples, Executive Information Systems –
Artificial Intelligence Technologies.

MIS & DSS
MIS focuses more on planning the report of various

topics concerned with the organisation that would assist
the managers to take vital decisions pertaining to the
functioning of the organisation.
DSS is an improvement of the concept of MIS.
DSS focuses more on leadership and decision making
Operational efficiency Vs effective decision making.

MIS & DSS
Management Information System Decision Support System (DSS)
(MIS)
1 Focus: structured tasks and Focus: semi/unstructured tasks which demand
routine decisions managerial judgment
2 Identifies information requirement Develops certain tools for using in the
decision
process.
3 Importance on data storage Main emphasis is on data – manipulation.
4 Very much dependent on the Depends on the managerial judgment.
computer expert.
5 Main stress is on the efficiency. Main emphasis is laid on the effectiveness.
6 Provide information about the Provide information and decision support
performance of the organization techniques to analyse specific problems.
7 Information format is pre-specified Flexible and adoptable format

Expert Systems
Definition: Expert Systems are computer-based

systems that emulate the decision-making ability of a
human expert in a specific domain.
They are designed to solve complex problems and
provide advice in areas where human expertise is
crucial.

Functionality of Expert Systems
Functionality: Expert Systems use a knowledge base of

facts and heuristics (rules of thumb) to analyze
information and provide recommendations or solutions.
They typically involve an inference engine that
processes data based on the knowledge stored in the
system.

Applications of Expert Systems
Expert Systems find applications in various fields such

as medicine, finance, engineering, and troubleshooting,
where a deep understanding of a specific domain is
required.

Executive Information Systems (EIS)
Definition: Executive Information Systems (EIS) are

specialized information systems designed to support the
information and decision-making needs of top-level
executives in an organization

Functionality of Executive Information Systems
EIS provide a summarized and easily understandable

view of the organization's key performance indicators
(KPIs) and other relevant data.
They often include graphical representations and
dashboards to help executives quickly assess the overall
health and performance of the organization.

Applications of Executive Information Systems
EIS are primarily used by top executives for strategic

decision-making.
They aggregate information from various sources and
present it in a format that facilitates high-level decision-
making.
EIS can cover a broad range of information, including
financial data, market trends, and internal operational
metrics.
Applications of Executive Information Systems
Expert Systems focus on providing expert-level
decision support in specific domains, while Executive
Information Systems are tailored for top-level
executives to facilitate strategic decision-making by
providing a comprehensive overview of organizational
performance.
Both types of systems play important roles in enhancing
the decision-making capabilities of organizations in
different ways.
Artificial Intelligence in MIS
Artificial Intelligence (AI) technologies play a

significant role in the field of Management Information
Systems (MIS).
These technologies leverage advanced computational
capabilities to analyze data, extract patterns, and make
intelligent decisions.

Uses of Artificial Intelligence in MIS
1. Machine Learning
(ML): Machine Learning is
a subset of AI that involves
the development of
algorithms that enable
computers to learn from
data and improve their
performance over time
without explicit
programming.
Machine Learning
Applications in MIS: ML is used in MIS for predictive

analytics, pattern recognition, and decision support.
It can help organizations make sense of large datasets,
identify trends, and make predictions based on
historical data.

2. Natural Language Processing (NLP)
Natural Language Processing is a branch of AI that

focuses on the interaction between computers and
humans using natural language.
It involves the ability of computers to understand,
interpret, and generate human language.

Natural Language Processing (NLP)
Applications in MIS: NLP is employed in MIS for

tasks such as text analysis, sentiment analysis, and
language translation. It enables systems to extract
valuable information from unstructured text data,
facilitating better decision-making.

3. Expert Systems
Definition: Expert Systems, as mentioned earlier, are

AI systems that emulate the decision-making
capabilities of human experts in specific domains.
Applications in MIS: Expert Systems are used in MIS
to provide specialized knowledge and decision support
in areas where human expertise is critical. They help
automate complex decision-making processes.

4. Robotics Process Automation (RPA)
Definition: RPA involves the use of software robots to

automate repetitive and rule-based tasks within
business processes.
Applications in MIS: RPA is employed in MIS to
automate routine tasks, reduce manual efforts, and
improve efficiency. It can be used for data entry, report
generation, and other repetitive tasks.

5. Data Mining
Definition: Data Mining involves the extraction of

patterns and knowledge from large datasets using
various statistical and machine learning techniques.
Applications in MIS: Data Mining is used in MIS for
discovering hidden patterns, trends, and relationships
in data. It helps organizations gain insights into their
operations and make informed decisions.

6. Cognitive Computing:
Definition: Cognitive Computing involves creating

systems that can mimic human thought processes,
including learning, reasoning, and problem-solving.
Applications in MIS: Cognitive Computing is applied
in MIS to enhance decision-making by enabling
systems to understand complex data, reason through it,
and provide insights that go beyond traditional
analytics.
AI in MIS
The integration of AI technologies in MIS enhances the

capabilities of information systems, enabling
organizations to derive valuable insights, automate
tasks, and make more informed and strategic
decisions.

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MANAGEMENT INFORMATION SYSTEM

Prepared by THOMAS JOHN VJIM

Prepared by THOMAS JOHN VJIM

Information Systems (IS) refer to the combination of

Prepared by THOMAS JOHN VJIM

Prepared by THOMAS JOHN VJIM

Prepared by THOMAS JOHN VJIM

1.Data: Data is the raw

Prepared by THOMAS JOHN VJIM

4. Software: Software includes

Prepared by THOMAS JOHN VJIM

5.Database: Databases are

Prepared by THOMAS JOHN VJIM

Operations Support System

Transaction Processing System (TPS)

Process Control Systems

Enterprise Collaboration System

Management Support Systems

Management Information System (MIS)

Decision Support System

Executive Information System

Prepared by THOMAS JOHN VJIM

Prepared by THOMAS JOHN VJIM

They process transactions in two different ways:

The point of sale (PoS) systems

To monitor and control physical processes.

Prepared by THOMAS JOHN VJIM

It enhances team and workgroup communications and

Prepared by THOMAS JOHN VJIM

Management support systems (MSS) provides

Prepared by THOMAS JOHN VJIM

Decision support systems (DSS) give direct computer

Executive information system (EIS) provides critical

•Functional business systems:

A systems approach in problem solving is a holistic and

Prepared by THOMAS JOHN VJIM

Prepared by THOMAS JOHN VJIM

Select the Best Implement

Business Information Systems – Marketing

Prepared by THOMAS JOHN VJIM

Business Information Systems are the information

Prepared by THOMAS JOHN VJIM

Marketing Information systems

A Marketing Information System (MIS) is a

Prepared by THOMAS JOHN VJIM

1. Data collection – from internal and external

Product Development • Assessing customer needs and preferences

A Manufacturing Information System (MIS) is

Prepared by THOMAS JOHN VJIM

It helps in planning, executing, and controlling the

MIS integrates various aspects of manufacturing,

Prepared by THOMAS JOHN VJIM

• Monitor and control quality of products through

• MIS facilitates the coordination and integration of

• MIS provides tools for analyzing and reporting

Prepared by THOMAS JOHN VJIM

A Human Resource Information System

1. Employee Information Management

Prepared by THOMAS JOHN VJIM

2. Recruitment and Applicant Tracking

Prepared by THOMAS JOHN VJIM

3. Time and Attendance Management