Management Information System

Introduction to Management Information System

Meaning and Definition of MIS

Evolution of the concept
Objectives of MIS
Characteristics of MIS
Components of Information System
MIS and its functional Subsystems
Roles of Computers in MIS
 Meaning and Definition of MIS
Management information System is defined as A comprehensive and co-ordinate
set of information system which are rationally integrated and which transform
data into information in a verity of ways to enhance productivity in conformity
with managers styles and characteristics on the basis of established quality
criteria.

In the words of Kelly, MIS is a combination of human and computer based

resources that result in collection, storage, retrieval, communication and use of
data for the purpose of efficient management of operations and for business
planning.
 Meaning and Definition of MIS

Foe Jerome Kenter, MIS is a system that aids management in

making, carrying out and controlling decisions.

Gordon B. Davis defines Management Information System as an

integrated user-machine system for providing information to support
the operations, management and decision-making functions of an
organisation. The system utilizes computer hardware and software,
manual procedures, models for analysis, planning, control and decision
making and database.
 Evolution of the concept

Period Major focus Main function

1950-1960 EDP Transaction Processing,
(Electronic Data Processing) Record Keeping and
accounting
1960-1970 IRS Information reporting
(Internal Revenue Services)
1970-1980 DSS Decision Support
(Decision Support System)
1980- Onwards EIS & KBS Special Information needs of
(Executive information top management and use of
system) artificial intelligence in
(Knowledge Based System) problem solving
Todays Society
It provides support t business operations.
It also provides support to managerial decisions.
It helps to gain strategic competitive advantage.
Objectives of MIS

An effective MIS has following objective:

To facilitate the decision making process in an
organisation by providing timely information.
To furnish planning and control tools to top managers
at various levels.
To provide a system of people, equipment, procedures,
documents and communications, that collects,
validates, operates, transforms, stores, retrieves and
presents data for use in planning, budgeting,
accounting, controlling and other managerial functions.
Objectives of MIS
To assist the management in controlling activities by
highlighting the crucial factors and problem areas.
To evaluate the approach of managers towards MIS.
To create a processing of communication where
information is recorded, stored and retrieved for
decision-making, planning, and controlling in the
organization.
Characteristics of MIS
1. Flexibility: Changes occur in organizations due to
various reasons. A good MIS must be capable of
adapting to these changes.
2. Reliability: MIS provides information to the
management for taking various decisions. So the
information provided must be reliable as far as
possible.
3. Simplicity: It is very difficult to systems which are
easy to operate and control. MIS should have a
simple design. design simple An effective.
 Characteristics of MIS..
4. Economy: MIS should be cost-effective. Costs should be
carefully monitored and a comparison should be made with
the original planned cost.
5. Helpfulness: The purpose of MIS is to help the
management in planning, control and decision-making. So,
an efficient MIS should serve this purpose.
6. Consistency: It means that the methods and scales used to
collect and present data must be consistent in nature.
 Characteristics of MIS..
7. Management-oriented: The development information
system efforts should start an appraisal management needs and
overall business objectives.
8. Integrated system: All functional and operational
subsystems should be tied together into one entity. Only then,
the system has the capability of generating more meaningful
information to management.
 Characteristics of MIS..
9. Subsystems: Information system must be broken down into
various subsystems.
10. Common database: Database is a consolidating a number
of data records formerly many separate data files
11. Computerized: Even though MIS can be developed without
computers, at present it is considered an integral part of it. Its
use increases the speed, accuracy, storage capacity, etc
12. Accuracy: Information must be accurate to great extent
because decisions are taken on the basis of such information.
Information system Components
A system is a set of related components, which can process
input to produce a certain output.
Information system Components .

Hardware is the physical embodiment of an information

system. It is one of the main elements which creates the
information system cycle.
Information system Components .
Functions of the Basic Hardware of a Computer
Information system Components .
Software
Software consists of two categories:
The system software
The application software.
System Software controls the computer and contains the operating system and
device drivers, which can communicate with the hardware. It can also modify
data into a new form, prevent viruses and make copies.
Application Software contains programs which can help users and enable
companies to perform business functions. Users can increase productivity with
the presence of application software such as spreadsheets, word processing,
ordering systems, and accounts receivable.
Information system Components .
Data:
Data refers to the raw facts on any thing or entities like student names, courses and
marks. The raw data that has not yet been provided can be processed to become
more useful information.
Difference between Data and Information:
Information system Components .
Process is a guide consisting of orderly steps, which need to be followed and
implemented in order to get a certain decision on certain matter.
Human
The main objective of an information system is to provide invaluable information
to managers and users, whether inside or outside the company.
Users can be broken up into three categories, which are:

End-Users, consisting of the staff, suppliers and others who communicate with the information system.
Internal Users, including the managers, technicians, sales representatives and corporate officers.
External Users, customers suppliers
 MIS and its functional Subsystems
Production subsystem: It deals with production of data
reports, and makes production planning, scheduling and cost
control analysis.
Marketing subsystem: It collects data for sales forecasting
and planning. It includes data relating to distribution cost,
promotion cost, etc.
Finance and accounting subsystem: It keeps data on
customer credit, accounts payable, accounts receivable, cash
management, fund allocation, etc.
 MIS and its functional Subsystems
Personal (HR) subsystem: This subsystem is concerned with
planning personnel requirements, analyzing performance,
salary administration, etc.
Information processing subsystem: It focuses on information
system planning, cost-effectiveness analysis, etc.
R&D subsystem: It deals development activities in an
organization.
 Roles of Computers in MIS
1. Forecasting:

Cyclical analysis in which cycle of booms depressions can be

discussed by factoring economic time series into trend, seasonal,
and error components is done by the computer.
Correlation and regression analysis involving a great deal of
calculations are carried out by computers.
Optimal parameters of the selected forecasting model can be
derived.
 Roles of Computers in MIS
2. Planning
It can be done more frequently and even continuously. Because of
constraints of computational and data processing abilities in manual
subsystems, it used to be the practice to set reorder level annually.
Now in computerised system, reorder levels can be revised much more
frequently.
Sophisticated models of planning can be employed.
Stimulation can speed up evaluation of alternative plans.
The user can interact with computer to do better planning
 Roles of Computers in MIS
3. Control :
More comprehensive, control techniques can be used with the
help of computers.
Varied, accurate and frequent reports can be produced where
necessary.
Statistical quality control techniques can be used to monitor
marketing and financial ratios.
4. Modelling:
Models can be tested for robustness, against historical or by
hypothesised data by stimulation. Computer also helps in model
building to sort the relationship.

5. Subsystem Analysis: Several MIS designs can be evaluated

by means of simulation experiments. This can be performed
only with the help of computers.
 Roles of Computers in MIS..
6. Database Facility: Data is no longer used department wise.
All planner, forecaster, supervisor, system analyst and modeller
can discharge their functions much better through a computer.
 Conclusion
Information is processed data that serves current or perspective
use. A system for providing right information to the right
person at the right time is called management Information
System.
Modern Information System use Information Technology , to
keep ahead of competition.
MIS is an evolving concept rather than a single large system, it
is a federation of closely integrated systems.
Q&A
Tutorial
Short answer Questions
1. Define MIS
2. Explain the evolution of MIS
3. Describe the importance of MIS
4. What are the objectives of MIS
5. What are the functional subsystems of MIS
6. What are the features of MIS
7. Explain the relationship between MIS and Information Technology
Tutorial
Essay Questions
1. Bring out the role of computers in MIS
2. Narrate the significance of MIS in the present
day business organization
3. Explain the various computer application in MIS