ISSN: 2277-4629 (Online) | ISSN: 2250-1827 (Print) CPMR-IJT Vol. 2, No.

1, June 2012
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Strategic Approach for Successful Implementation of
Management Information System for Manufacturing Industry

Murali Krishna Kuppili
1
, Dr. A R Aryasri
2

1
Director SoCtronics Technologies Pvt. Ltd., Hyderabad, India. Email muralikuppili@gmail.com
2
Director School of Management Studies, JNTU Hyderabad, India. Email- aryasri@yahoo.com

ABSTRACT

Purpose - To focus on challenges & strategic
approaches in implementing Management Information
System (MIS) for process equipment (For Ex: Pressure
Vessels, Boilers, Heat Exchangers, Agitators, Dryers,
Storage Containers) manufacturing industry.
Approach - Case study
Findings - There was about 20% of productivity
improvement after successful implementation of MIS for
various divisions in the organization.
Practical implications - One can understand better
in the context of process equipment manufacturing industry,
the concepts of management information system, its impact
on productivity & financials. The strategic approach
indicated here will help organizations, before introducing
MIS, to take appropriate actions in efficient implementation.
Originality/value This study will serve as a point
of reference for future studies in this area of concern
because of the inadequate academic literature and empirical
findings relating to implementation of MIS in process
equipment manufacturing industry.

Keywords: MIS, Equipment, Manufacturing,
Implementation, Issues


I. INTRODUCTION

The Management Information System (MIS) has
been existing in various organizations for more than 20
years. The concept of the MIS has evolved over a period of
time covering different aspects of the organizational
functions. The MIS is defined as An integrated system of
man and machine for providing the information to support
the operations, the management and the decision making
function in the organization.
The initial concept of MIS was to process data
from the organization and presents it in the reports at regular
intervals. This concept was further modified when a
distinction was made between data and information. The
information is a product of an analysis of data. This concept
is similar to a raw material and the finished product. Over
period of time, when these conceptual developments taking
place, the concept of the end user computing using multiple
databases & user interfaces emerged. This concept brought a
fundamental change in MIS which made the user
independent of the system. When this became a reality, the
concept of MIS changed to a decision making system.
The MIS is a product of a multi- disciplinary approach
to the business management. It is a product which needs to
be kept under a constant review and modification to meet
the corporate needs of the information. To have better
handle on information processing, it is necessary to have a
formal system which should take care of following aspects:
Managing large volumes of data
Confirmation of the validity of data and
transaction.
Complex processing of data and multidimensional
analysis.
Quick search and retrieval.
Efficient storage and security of the data.
Availability of the information system to the user
on time.
Fulfilling the changing needs of the information.
Provision to expand over a period of time in-line
with the business growth.
The MIS satisfies the diverse needs through a variety of
systems such as Query Systems, Analysis Systems,
Modelling Systems and Decision Support Systems. The MIS
helps in Strategic Planning, Management Control,
Operational Control and Transaction Processing.
The MIS helps the clerical personnel in the transaction
processing and answers their queries on the data pertaining
to the transaction, the status of a particular record and
references on a variety of documents. The MIS helps the
junior management personnel by providing the operational
data for planning, scheduling and control, and helps them
further in decision making at the operations level to correct
an out of control situation. The MIS helps the middle
management in short-term planning, target setting and
controlling the business functions. It is supported by the use
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of the management tools of planning and control. The MIS
helps the top management in goal setting, strategic planning
and evolving the business plans and their implementation.
The MIS plays the role of information generation,
communication, problem identification and helps in the
process of decision making. The MIS, therefore, plays a
vital role in the management, administration and operations
of an organization.


II. LITERATURE REVIEW

The paper on ERP indicates seven categories of
critical success factors from the ERP literature
[1]
. The
importance of these factors across the phases of ERP
implementation and upgrade is very similar. 'Business Plan
and Vision' and 'Top Management Support and
Championship" are critical during the Chartering phase.
ERP Team Composition, Skills and Compensation,' 'Project
Management' and 'System Analysis, Selection and Technical
Implementation' are most important during the Project
phase. 'Change Management and 'Communication' are very
important during the Project and Shakedown phases.
In one of the research papers it is indicated that
Management Information System is a system which is very
useful and helpful to get information about any organization
or different departments of an organization and different
kinds of fields
[2]
. In this paper it is described what is MIS,
components and types of MIS, what is the use of MIS etc.
The design of a computer based MIS to aid in the search for
information is a specialized task, requiring extensive
knowledge of how information can be organized and how
people search for information. There are some most
important things to consider while implementing MIS such
as computerized infrastructure, technical trained staff,
accurate data collection and a database management etc.
In another research paper, it is indicated that the
transaction processing layer of MIS in human resource
function deals with routine activities like attendance
recording and payroll calculations. The operational level
activities also include maintaining the employee records
which is used as a basis for strategic layers
[3]
. With the
growing importance of human resource management and
increasing size of the organizations, maintenance of
employee related data and generating appropriate reports are
the crucial aspects of any organization. Therefore more and
more organizations are adopting computer based human
resource management systems (HRMS). This paper is an
attempt to design and implement an MIS for the business
organization and show how it helps in taking management
decisions related to management function especially for the
top management.
The paper on healthcare indicated that major
challenges remain in Latin American countries experiencing
Healthcare reform
[4]
. Among these challenges, the
implementation of decentralized organization, implementing
information systems and strengthening the management
capacity of district health providers & district health
authorities remains neglected, or at least undervalued. The
objective of this paper is to illustrate a substantive process
theory of IS implementation, situated within the context of a
case study. The case study is based on a national
information systems initiative to support the decentralization
and modernization of management functions in health
districts of the Ministry of Public Health in Ecuador.
From the study of various research papers, it is
understood that MIS plays a very important role in modern
organizations in various domains. It is necessary to follow a
systematic approach for successful implementation of MIS.
This paper mainly focuses on a case study from process
equipment manufacturing industry to present issues faced
just after implementation of MIS and suggestive solutions to
overcome these challenges.


III. OVERVIEW OF CASE STUDY

In this case study a process equipment
manufacturer organization (name changed Promu
Equipment Manufacturers) in India was considered for
analyzing the implementation challenges of management
information system and solutions considered to overcome
these challenges for successful implementation. Promu is
involved in design & manufacturing of process equipment
such as Pressure Vessels, Heat Exchangers, Agitators,
Boilers, Dryers, Storage Tanks & Reactors etc. for large
scale chemical, power plants, food processing,
biotechnology & petroleum industry.
This company was established 25 years back in
India with a very small setup and grew one of the prominent
process equipment suppliers over a period of time. Promu
was started explored to implement computerization in the
late eighties or early nineties mainly for design of process
equipment. Their design teams have started looking for
some commercial applications and also explored to
development of computer applications using C, FORTRAN
& AutoCAD. The executive team has realized quicker
design solutions & most optimized designs to save the
efforts & cost of overall project.
Above momentum was picked up and company has
started thinking about more & more automation not only for
their equipment design but also into material requirement
planning, production planning, resource allocation, sales
tracking, financial management & human resource
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management etc. The company has replaced most of their
official communication with paper work by emails and
manual design with computerized designs in mid-nineties to
late nineties. The executive team has also started monitoring
their business and financial reports in computerized formats
in mid-nineties.
However, the above journey of implementing
computerization or management information system was not
so easy. The company faced lot of challenges in replacing
the existing manual systems with computerized systems viz.
convincing employees, training on new systems, seamless
coordination with external teams (such as vendors,
customers, investors & government), management of funds,
validation of computerized design & reports with manual
systems etc. The company identified a core team of 8
members, one being at a very senior level who can take the
decisions quickly to fully implement the management
information system across all the groups in the organization.
These eight members were from different groups such as
Marketing, Planning, Production, Procurement, Software,
Engineering, Personal & Finance.
The above core group was responsible for
evaluating issues of computerization, define appropriate
solutions, development of these solutions internally or
involving external teams as needed & successful
implementation of these solutions in the organization.
Following sections explains the challenges faced, solutions
implemented and derived benefits with the implementation
of appropriate solutions.


IV. OBJECTIVE & SCOPE

The objective of this paper includes:
Analyzing the manual system & understanding
challenges faced just after implementation of
management information system.
Crafting strategic solutions, seamless
implementation & derived benefits upon applying
the strategic solutions to fully implemented MIS.
The scope of this paper includes:
Understanding the case study considered in writing
this paper
Analyzing issues observed just after
implementation of MIS
Listing strategic solutions implemented to address
issues & challenges
Looking at derived benefits after implementing
outlined strategies.


V. REVIEW & ANALYSIS

The executive team has collected the productivity
data of various functions prior to implementation of MIS
and just after implementation of MIS. The productivity was
measured in terms of efforts for a specified duration for
similar activities during that period. The productivity is
considered as lower if more efforts are required.
Following table indicates design & manufacturing
of certain equipment considered for collecting the data and
measuring the productivity before and just after
implementation of MIS:

Table-1: Description of Process Equipment

Item
Code Equipment Description
EQP-01
Heat
Exchanger
Stainless steel Heat Exchanger
with 100 copper tubes and
brass tube sheet for medium
pressure
EQP-02
Pressure
Vessel
Stainless Fermenter with 6mm
thickness & 100 m
3
volume
EQP-03 Agitator
8m long, 15cm shaft diameter
with 3 blades in stainless steel
EQP-04
Storage
Tank
200 m
3
volume with Mild-
steel tank
EQP-05
Distillation
Column
A stainless distillation vessel
with 4mm thick, 20 meter
height 40 trays inside
EQP-06 Boiler
A mild steel vessel with tubes
inside to heat the water and
produce steam

Following diagram indicates the comparison of
efforts required for design and manufacturing of above
equipment two years prior to implementation of MIS and the
year of implementation of MIS.
The diagram indicates that the efforts required to
design and manufacture various equipment in a 3 months
time frame and also the start & end schedule for each
equipment. The light grey color indicates efforts required
before implementing MIS and dark grey color indicates
efforts required just after implementation of MIS. It shows
that more efforts are required just after implementation of
MIS due to some redundant activities and more time taken
to understand and enter the data into the system.
From the review and analysis of data before
implementation of MIS and just after implementation of
MIS the executive team observed that various teams were
not following the MIS efficiently. It was observed that there
was lot of duplication in activities, executing both manual
and using computing systems. This situation was noticed by
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Figure-1: Efforts Required to Manufacture Equipment

the executive management team from the status reviews &
started thinking about how to improve productivity by
making use of MIS effectively.


VI. ISSUES & CHALLENGES

In a typical scenario the organization faces lot of issues
and challenges during implementation of MIS. These issues
related to change of human behavior, understanding the new
systems, ensure accuracy of the results with new systems,
More efforts and time required to complete a task at the
beginning, more reviews and guidance from experienced
persons in MIS & Functional domain etc.
Following were the few challenges observed just after
implementation of MIS:
There was no enough documentation available to
understand how to use and manage the data while
working through MIS.
Not many trained professionals were available who
can explain and guide the large teams. Individuals
were waiting long duration to get certain
clarifications. In the meantime they were switching
back to manual system.
The overall planning activity was not proper.
Enough time was not allocated to complete the task
by the individuals considering new systems.
Lot of time required in coordinating with
interdependent teams as everyone in the
organization was new to use the MIS systems.
Some of the individuals were spending duplicate of
efforts due to non-confident about the results come
out of the MIS.
Initially the systems were slow as the network
bandwidth was not sufficient and application
response was slow due to congestion in database.
Since most of the individuals were comfortable
following manual systems, there was a strong resistance in
the beginning for shifting to MIS. Since most of the staff
was not from computer background, some of the basic
issues were also need to be resolved by the software or
system expert. The organization did not really benefit with
the financials after implementation of MIS. The executive
team observed that the share price dropped, operating
expenses increased, debt accumulated, and margins were
declined etc.


VII. PROPOSED OPTIONS

From the analysis of data, it was clearly understood that
the organization was not really leveraging MIS
implementation efficiently to offer lower product cycle
times, design optimizations, effective production planning,
efficient inventory management, proficient executive
management reports etc. Based on above analysis, the
management team asked key team leaders in respective
functional areas to arrange a common meeting to discuss:
How to leverage MIS capabilities by all the
functional groups efficiently.
How to share knowledge between groups without
impacting the production.
How to avoid duplicity or redundancy in
performing certain tasks.
How do we ensure teams to stop using manual
systems for which computerization implemented.
How to standardize certain processes across the
teams to bring clarity.
Based on multiple meetings with senior leaders from all
the functional groups management team has proposed few
options given below to overcome the issues and challenges
just after implementing management information system.
Option-1: Discard the manual systems for the
functions where MIS was implemented on pre-
defined cut-off date. Anticipated risk in this option
as some of the employees who have not yet trained
on new systems may not be able to produce proper
results using MIS.
2 4 6 8 10 12
EQP-01
EQP-02
EQP-03
EQP-04
EQP-05
EQP-06
Efforts in Weeks







Efforts After MIS
Efforts Before MIS
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Option-2: Implement MIS in fullest extent where
the employees are clear about MIS for other areas
continue with manual system where employees still
need trainings in implementation of MIS.
Options-3: Identify core group of 8 members
having one leader from each functional area and
one among the 8 will be heading the core group to
review and take quick decisions. Prepare a plan for
complete implementation with resolution of all
back log issues and new issues if any.
Executive team reviewed alternative options and
defined few workable strategies around Option-3 as
described below to address issues & challenges in
implementation of management information system.


VIII. SOLUTIONS IMPLEMENTED

After thorough analysis, the management team
formulated few solutions to address the issues with
implementation of MIS. The executive management team
has created a core team (task force) of 8 members one from
each functional group to understand issues and implement
following strategic solutions.
Identified implementation gaps and planned for
completion
Reviewed the implementation status just
after first level of implementation and collected all
the gaps from functional leaders to plan properly
for successful closure of MIS implementation.
Modified organization structure to align relevant
functions
Core team has analyzed the issues with
reference to organization structure just after
implementation of MIS and re-aligned to mitigate
the issues.
Ex-1: Earlier Stores, Inventory &
Production functions were managed independently
by respective leaders. After implementation of MIS
there was some coordination issues observed
between these teams. The core group decided to
merge Stores and Inventory under Production
Management.
Ex-2: Earlier Marketing & Customer
support were two different teams. After
implementation of MIS the issues were noticed in
managing the customer feedback between these
two groups. Hence the core team moved customer
support under marketing.
Ex-3: Earlier Production Planning Control
(PPC) was an independent group responsible for
creating bill of material, coordinating with
procurement to make available required items &
planning resources to various production units.
After MIS implementation this group was
discarded and allocated bill of material preparation
to engineering team & other two functions to
Production Management.
Allocate time & budget (additional efforts) for
trainings
The core group identified process
trainings required to understand how to use MIS,
how to obtain & enter data required in MIS
applications. The core team also arranged trainings
to explain the rationale behind implementing the
MIS and how it benefits in the day to day activities
at various levels for different functions in the
organization.
This solution helped teams to not only
obtain missing knowledge but also built
networking for future interactions to get the
required clarifications.
Modify the existing documentation to suite MIS
requirements
There were few documents like
specification sheets, bill of materials, inventory
records, stores ledger, customer requirements &
invoice etc. modified to suite MIS applications.
Some of the procurement components & raw
materials have been provided with unique
numbering system to easily correlate in
procurement, stores, finance, production &
inspection records.
This strategy helped teams to reduce the
entry of repetitive data. Most of the items were pre-
entered into database to enable user to select the
required items.
Manage spare capacity appropriately with proper
allocation
Upon implementing MIS, there was an
additional capacity available from machines due to
design optimizations and also spare capacity
available from manpower due to reduction in
manual tasks. These surplus capacities were used
for design and production of additional equipment.
These capacities were identified through proper
work study (method study & work measurement)
techniques
This enable not only using surplus
capacities but also provided diversified
opportunities to employees and also optimum
utilization of machinery.
Well defined responsibility & authenticity in the
system
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The core team has defined well-structured
responsibilities for various functional groups and
appropriate authentication was provided in the
system. The access permissions of individual login
allowed doing certain tasks based on their levels.
Ex-1: Sales Engineer were unable to offer
discount on total project value, however sales
manager have permission to provide discount.
Ex-2: Procurement Engineer could not
decide the payment terms with vendors; however
procurement manager can alter the standard values
based on need.
This strategy enabled all the functional
groups to work on their respective assignments
without any duplicity. It has also provided better
control over financials as the system allows only
authenticated persons to do certain tasks where it
involves financial implications in the decisions.
Prototyping MIS implementation with manual
system to validate
One of the issues noticed were most of the
MIS applications for various groups were
implemented without enough sample runs. During
the sample runs 3 stages were followed.
Stage-1: Run activities through manual
system as well as MIS. However consider the
results produced from manual system and validate
the results received from MIS with manual results.
Provide appropriate feedback to respective teams &
MIS implementation team.
Stage-2: Run activities through manual
system as well as MIS. However consider the
results produced from MIS and validate these
results with manual system results. Feedback
provided to system implementers & respective
teams. Repeat Stage-2 one or two times to ensure
correct output from the system.
Stage-3: Discard the manual system and
continue to use MIS.
This was enabled to reduce the downtimes
during the actual production implementation and
also provided enough training to users.
Customized user interface in MIS to simulate
manual system
The standard User Interface (UI) was not
very user friendly and it was taking lot of time to
navigate and enter the data. This issue was
identified during the initial review and made
certain changes in UI to simulate manual system.
Ex-1: While creating purchase order, the
standard system UI was not displayed the discount
factor, however in practice this entry is required.
Ex-2: While creating bill of material
system was not accepting non-standard pipe sizes.
However in practice there are certain fabricated
pipes for which the pipe diameter may not be as per
standards.
This enables system applications to
simulate the manual system which will reduce the
duplicity of work and convenient for user to follow
the existing process.
Identified network issues and enhanced the
bandwidth as needed
Users faced serious issues with network
bandwidth due to which they were unable to
complete the tasks in time which dependent on the
system. In some cases users used to shift to manual
system to complete the task. This issue was
resolved by increasing the network bandwidth and
also enhancing the processing speed of individual
working systems.
This was enabled not only to speed up the
activities but to motivate the users to do more tasks
in a given time frame.
Checked the performance of database servers and
upgrade
Users faced system performance issues
though the network bandwidth was good. The core
team identified that the issue was with database
server. The server was choked due to large
quantum of requests from users. This problem was
resolved by certain extent with changes in database
architecture and also increased the system capacity
(Processor, Memory & Storage) to enhance the
performance.
This enabled quicker response from the
database which in-turn helped reduce the overall
time required to complete certain tasks.
Close monitoring of the results till the MIS was
fully implemented
There were almost negligible or no
reviews and quick resolution of issues just after
implementation of MIS. This impacted some of the
functional groups in using MIS and they started
using manual systems to complete the tasks. The
core group noticed this issue and created a small
application to log the issue requests from users.
The core group also created a small virtual team
with technical & domain experts to quickly
understand these issues and resolve at the earliest
possible based on priority.
This enabled users to get their resolutions
quickly and prevent them to switch over to the
manual system again.
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Figure-2: Efforts Required to Manufacture Equipment

Above diagram indicates efforts required for design
and development of equipment just after implementation of
MIS and after implementing efficient solutions to overcome
the issues faced just after implementation of MIS. The
diagram indicates that the efforts required after
implementing solutions is much lower than the efforts
required just after implementation of MIS.

Table-2: Comparison of Efforts for Manufacturing

Item
Code Equipment
Efforts in Weeks to
Manufacture Equipment
Case-A Case-B Case-C
EQP-01
Heat
Exchanger
8 10 6
EQP-02
Pressure
Vessel
4 6 3
EQP-03 Agitator 4 6 3
EQP-04
Storage
Tank
4 5 3
EQP-05
Distillation
Column
10 12 8
EQP-06 Boiler 6 8 5

Case-A: Efforts Before Implementation of MIS
Case-B: Efforts Just After Implementation of MIS
Case-C: Efforts After Implementing Solutions
From the above table it is clearly understood that
the effective implementation of solutions helped to reduce
the overall efforts.
The efforts saved will benefit the organization to
reduce the development cost, time to market, increase the
share value, reduce the price and enhance the margins etc.


IX. CONCLUSION

The organization faced lot of challenges in the
beginning (just after MIS implementation) due to lack of
enough focus & strategic approach in implementation. After
implementing the above solutions the organization delivered
equipment in much lesser time frame. This approach was
well appreciated by internal & external stakeholders and the
organization not only turned around to get into good
financial health & profit margins but also successfully
implemented MIS for further business growth.


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