Introduction about management information system

1. PREPARED BY :- KIRTI RANA
Management Information System
A management information system (MIS) is an ​information
system​]​
used for ​decision-making​, and for the coordination,
control, analysis, and visualization of information in an
organization.
The study of the management information systems involves
people, processes and technology in an organizational
context
DEFINITION:

2. Management information system is a system consisting of people, machines,
procedures, databases and data models, as its elements. The system gathers
data from the internal and external sources of an organisation.
MEANING:
Management information system is an acronym of three words, viz.,
Management, information, system .in order to fully understand the term MIS,
let us try to understand these three words.
Management:
Management is the art of getting things done through and
with the people in formally organised groups.
Managerial function:
Planning
Organising
Staffing
Directing
Controlling
Information:
Information is data that is processed and is presented in a
form which assists decisionmaking.it may contain an element
of surprise, reduce uncertainty or provoke a manager to
initiate an action. Data usually take the form of historical
records. In contrast to information, raw data may not be
able to surprise us, may not be organised and may not add
anything to our knowledge.
DATA-------→PROCESSING-------→INFORMATION

3. System:
The term system is the most loosely held term in
management literature because of its use in different
contexts. However, a system may be defined as a set of
elements which are joined together to achieve a common
objective. The elements are interrelated and interdependent.
The set of elements for a system may be understood us input,
process and output. A system has one are multiple inputs;
these inputs are processed through a transformation process
to convert these input into outputs. The three elements of a
system are
INPUT------→PROCESS--------→OUTPUT
What is the purpose of a management information system?
A Management Information System, or MIS, collects data
from many different sources and then processes and
organizes that data to help businesses make decisions. These
days, technology and data collection are so prevalent that
businesses large and small are using Management
Information Systems to improve their outcomes.

4. Purpose of MIS
1.​ ​To provide necessary information in suitable
form at suitable time.
2.​ ​To bring new matter to the knowledge of the
management
3.​ ​To make available the necessary information at
minimum cost.
4.​ ​To update the information with addition
–deletion.
5.​ ​ To preserve important data which is useful in
decision making.
6.​ ​To emphasis on such decision involving higher
benefit / cost ratio.
7.​ ​To interpret past decision /experience clearly.
8.​ ​To supply necessary data for big task of the
management

5. 9.​ ​To supply trustworthy and logical data.
10.​ ​To control various project activities.
What are the benefits of MIS?
A management information system provides the data to
identify non-performing areas and leads to the following
benefits:
● Helps to achieve a higher level of efficiency.
● Improves the quality of decisions.
● Promotes better communications between departments
in a workplace.
ADVANTAGES
1. It Facilitates planning: MIS improves the quality of plants
by providing relevant information for sound decision -
making. Due to increase in the size and complexity of
organizations, managers have lost personal contact with the
scene of operations.
2. Minimizes information overload: MIS change the larger
amount of data into summarize form and thereby avoids the

6. confusion which may arise when managers are flooded with
detailed facts.
3. MIS Encourages Decentralization: Decentralization of
authority is possibly when there is a system for monitoring
operations at lower levels. MIS is successfully used for
measuring performance and making necessary change in the
organizational plans and procedures.
4. It brings Co-ordination: MIS facilities integration of
specialized activities by keeping each department aware of
the problem and requirements of other departments. It
connects all decision centers in the organization.
5. It makes control easier: MIS serves as a link between
managerial planning and control. It improves the ability of
management to evaluate and improve performance. The
used computers has increased the data processing and
storage capabilities and reduced the cost.
6. MIS assembles, process, stores, Retrieves, evaluates and
disseminates the information.
DISADVANTAGES:
1. Highly sensitive requires constant monitoring.
2. Budgeting of MIS is extremely difficult.

7. 3. Quality of outputs governed by quality of inputs.
4. Lack of flexibility to update itself.
5. Effectiveness decreases due to frequent changes in top
management
What are the various functions of information systems?
One of the mostly widely used bases for organising activities
in almost every organisation is the business function.
Business activities are grouped around functions such as
production, marketing, finance and personnel etc...
Resulting in the respective department or an area of the
business organisation. These departments or functional
areas are commonly known as the functional areas of
business.
There is no standard classification of such sub-system in an
organisation, but a typical set of functions in a
manufacturing organisation includes:
Production
Marketing
Finance accounting Materials
Personnel systems
Production:

8. Production planning and control
Engineering standards
Quality control
R & D etc
Marketing:
Sales order
Forecasting
Sales analysis
Billing
Distribution
Stock availability
Sales quota control
Pricing
Product promotion
Finance and accounting:
Financial planning
Budgeting
Cost accounting
Asset accounting
Accounts receivable
Payroll
Accounts payable, etc…
Materials:

9. Material planning
Bill of material
Cost estimate
Warehousing planning etc…
Personnel:
Employee recruitment
Employee selection
Employee development
Employee transfers
Employee retirements etc...
Need of Management Information System
Meeting global challenges
Capturing opportunities in marketplace
Supporting corporate strategy
Linking departments whose functions are different
Enhancing worker productivity
Increase in quality of goods and services
Characteristics of good MIS
1.​ ​Completeness: - the information should include
all the elements required to take decision, it

10. should be complete .it should show the
alternatives in decision making.
2.​ ​Clarity and conciseness: - the collected
information should be perfect and concise.
3.​ ​Consistency: - the information collected by
different person should be consistent with each
other.
4.​ ​Predictive ability: - MIS must give prediction of
any difficult event before its occurrence.
5.​ ​Relevant: - only necessary information should
be stored and unnecessary information should
be removed to avoid any confusion.
6.​ ​Timeliness: - all the current information should
be available to the management.
7.​ ​Simple: - MIS should be simple and easy to
understand.
8.​ ​Effectiveness: - MIS should be such that
important decision can be taken on time
effectively.

11. 9.​ ​It should be possible to present the data
collected at lower level to higher level.
Classification of management Information system
The classifications of information system are
Transaction processing system.
Management information system.
Decision support system.
Executive support system.
Office automation system.
Business expert system.
Transaction processing system:
It represents the automation of the fundamental, routine
process used to support
business operations. It does not provide any information to
the user for his/her decision
making. Previously Transaction processing system was
known as MIS. Prior to computers,
data processing was performed manually or with simple
machines.
(INPUT) DATA--------→PROCESSING--------→DATA
(OUTPUT)

12. Management information system:
MIS is an information system which process data and
converts it into information.
A MIS uses TPS for its data inputs. The information
generated by the information system
may be used for control of operations, strategic and long
range planning, short range
planning, management control and other managerial
problem solving.
It has some functional business areas. They are
Marketing
Production
Human resources
Finance
Accounting etc...
TPS------→DATA------→INPUT------→PROCESSING-------
→OUTPUT-----
---→INFORMATION
Decision support system:
The Decision support system (DSS) is an information system
application that assist

13. decision making. Decision support systems tend to be
designed primarily to serve
management control level and strategic planning level
managers.
The data in the database typically is a combination of
master files (internal
corporate data) and from external sources.
Database←-------------→model base
↘user interface ↙
↕
User
Executive support system:
Executive support system (ESS) is an extension of the
management information
system which is a special kind of DSS. An ESS is specially
tailored for the use of chief
executive of an organisation to support his decision making.
An ESS is designed to cater to the information needs of a
chief executive keeping
in view not only his requirements but also taking into
account his personality and style of
functioning etc.,
Office automation system:
Office automation refers to the application of computer and
communication

14. technology to office functions. Office automation systems are
meant to improve the
productivity of managers at various level of management by
providing secretarial assistance
and better communication facilities. Office automation
systems are the combination of
hardware, software and people in information systems, that
process office transactions and
support office activities at all levels of the organisation.
These systems include a wide range of support facilities,
which include word
processing, electronic filing, electronic mail, message
switching, data storage, data and voice
communication etc...
In the first category,
the following is a list of activities.
Typing
Mailing
Scheduling of meetings and conferences
Calendar keeping and
Retrieving documents
In the secondary category,
Conferencing
Production of information
Controlling performance

15. Business expert system:
Business expert system (BES) is a knowledge based
information system that uses its
knowledge about a specific, complex application area to act
as an expert. This system is
one of the knowledge based information system.
Expert system provides decision support to managers in the
form of advice from an
expert in a specific problem area. Expert systems find
application in diverse areas,
ranging from medical, engineering and business.
Knowledge base←-------------→inference engine
↘user interface ↙
Physical Structure of Management Information Systems
A MIS is an organized system which consists of people,
hardware, and communication networks and data sources
that collects, transforms and distributes information in an
organization. It is a tool which helps mangers in making

16. decisions by providing regular flow of accurate information
in an organization.
The physical components of an MIS include hardware,
software, database, personnel and procedures.
Hardware
Hardware consists of all physical components of a computer
system like central processing unit (CPU), input devices,
output devices, storage and communication devices.
Software
Software is an interface between the information system and
users of the information system. Software can be of two
types’ system software and applications. The system
software includes the operating system and special purposes
programs. Application is developed to achieve a specific
task. Software plays an important part in MIS.
Database
A database is a centrally managed and organized collection
of data. Database helps to store data in an organized manner
and to make available to those who need that data. Database
helps to reduce duplication of data as it is centrally managed

17. data one data can be stored at one place avoiding
redundancy and duplication of data.
Procedures
Procedures are essential for effective use of information
systems. Procedures consist of various instructions like user
instructions, instructions for input preparation and
operating instructions. These instructions help in using
information systems effectively.
Personnel
Number of personnel is required for implementation of MIS
like computer operators, programmers, systems analysts and
managers. Human beings are key requirements for
implementation of MIS. In MIS both technical and
managerial level people are required for proper
implementation of MIS.

18. Implementation of MIS
The following steps are followed in the
implementation of MIS.
1.Input data
2.Information stored and retrieved
3.Analysis
4.Output
5.Decision making
6.Actions
Input data
Once the objectives are decided the MIS designer
determines which input data is required and how to
collect it. Unnecessary data are removed from the
collected data.to make MIS effective,only meaningful
data should be collected.
Information stored and retrived

19. The collected meaningful data are stored ,additions are
made whenever necessary.This type of data can be stored in
a hard file.
Information retrieval means numbering of
information,classification,giving symbol etc. so that
necessary information can be viewed quickly and easily .
Analysis
The information analysed as under is
Problem identification
Deciding objective of management
Finding solution to the problem
Finding optimum solution
To follow implementation procedure
Output
After analysing the information it can be presented in
the form of report,graph,chart,table etc.
Decision making
Based on MIS output,experience of the manager and
opinions of the concerned officer,decision is made.

20. Actions
The decision taken by management should be implemented
in the form of a solution to the problem .
Application of MIS
1.To carry out a market survey to collect the information
about competitors so that decision regarding product
quality,quantity and sale can be easily taken.
2.To provide knowledge about new process and technologies
3.Forecasting
4. For inventory management
5. For long term planning
6.For scheduling of problem
7.To search new opportunities
8.For reservation system in airlines
9.For appropriation of financial resources
10.For controlling daily activities
11. To know government policy related to the organization.

21. Key factors for success
The factors that are considered as key success factors in
implementing an information system are
as follows:
1- Manager who is familiar with the information system
2- Project Manager
3- Enterprise Information Systems IS appropriate box
4- The right technology
5- Data Management
6- Communicate clearly with business goals
7- Management of organizational strength
8- Manage the development and expansion of the system
9- Evolutionary development
10- Definition of informational needs of users