MIS

Management Information System

Chapter-I

Prof. Vaishali Kadu

• Ch-01
• INTRODUCTION OF MIS
• Today the need for an update information has
become inevitable to arrive at an effective decision
in all walks of life.
• Whether it is industry, commerce, defense,
banking, education, economics or politics,
information is needed everywhere.
• A significant part of an executive’s working
and personal time is spent
on recording, searching, absorbing and
communicating information.
• Information is ‘live’ as it is required to be updated
all time and is renewable. It is substitutable and
transportable and can be made to travel.
• The all round exponential growth of information
makes it necessary that information is collected,
stored and retrieved various fields so that it could
be usefully.
• For Example; in setting up a new industry,
information regarding the choice of technology
(methods), skill (manpower)
• Money and material becomes an important
requirement for its growth and smooth functioning.
• In a competitive market before deciding about the
price of an item, the producer needs information
about the pricing police of the competitors,
• Information is considered as the sixth resource the
other five being men, machines, materials, money
and methods (technology).
 MIS

Management Information System

A) Environmental information:- Example

Planning, Governmental Policies
Organizing, Economic trends
Directing, ABC
Technological environment
Controlling, Factors of production.
Production
level are:- B) Competitive information:-
TLM, Industry demand,
MLM, Material control
Firm demand,
LLM The competition.

C) Internal Information:- Production control

1) Sale forecast
2) The financial plane Quality control
3) Supply Factors
4) Policies.
Purchase

Inward
stores Inspection
• Management information system
• The Management Information system (MIS) is an
integrated man-machine system that provides to support
the planning and control function of managers in an
organization.
• MIS can also be defined as the combination of human
and computer based resources that results in the
collection, storage, retrieval, communication and use of
data for efficient management of operation and for
business planning.
• MIS is something more than just a computer system.
Before the evolution of computer, MIS techniques existed
to supply users with information that would permit them to
arrive at an effective decision.
• The computer has added new dimension such as
speed, accuracy and processing
• of massive data, that permit the consideration of
more alternative in a decision.
• Management:-
• The specific natures of the activities are determined by such
managerial functions as planning, organizing, directing,
leadership (initiating or coordinating) and controlling.
Various management functions:-
• 1)Planning:- It is process of deciding in advance the
courses of action or strategies to be followed.

• 2)Organizing:- It is needed for assigning

responsibilities, job, and hierarchy. (routing)

• 3)Controlling:- control is means of checking the progress of

plans and correcting any deviations. control may be used to
measure physical quantities (volume of output, number of man
hours, number of units of raw material consumed per machine,
etc.) monetary results (value of sales, capital expenditure,
return on investment, earning per share),
• 4)Directing:- It is needed for implementation of plan by
providing desired leadership motivation and proper
communication.
• The management can also be grouped into
three hierarchical levels- top, middle and
junior (lower).
• 1)Top management:- establishes the policies,
plan and objectives of the organization as well as
a budget framework under various department will
operate.
• 2) Middle management:- the responsibility of
implementing the policies and overall plans of the
top management.
• 3)Junior management:- the responsibility of
implementing day-to-day operations and decision
of the middle management to produce goods and
services to meet the revenue, profit and other
goals.
 Allocation of manger’s time:-

Top management
Information for strategic planning decision making
(goal setting)

Middle management

Information for technical planning and decision making (target

setting)

Information for operational planning, decision making &

Junior management control

Transaction processing (clerical)

• Information:-
• Information can be defined as the data which is
organized and presented at a time and place so that
the decision-maker may take necessary action
• In other words, information is the result/product of
processing data the conversion process of data into
decision.
• For example:- some supporting documents, ledgers, source material for profit and
loss statements, may be used by the decision-maker for profit planning and control,
information is that of raw material to finished product.

Data process Information Decision

Specific/ meaningful Implementation

action
• Types of information
• A) Environmental information
• B) Competitive information
• C) Internal information
• A)Environmental information:-
• 1)Government policies:- information about government policies or
financial and tax affairs (any kinds of). political stability is required for
future planning decision.

• 2)Economic trends:-It includes information about economic indicator

like employment, productivity, capital investment, prices and wage
level which is affect all organization regardless of product or service,
consumer disposable income.

• 3)Technological environment:-the information on technological

changes or advancements is necessary for forecasting such changes in
the firm, and technical changes on new product and processes

• 4)Factors of production:-these information about the source, cost,

location, availability, accessibility and productivity of the major factors of
production such as labour, materials, spare part and capital.
• B) Competitive information:-

• 1)Industry demand:-
– forecast of the industry for the product manufactured or about area in which the
firm is operating.

• 2)Firm demand:-
– assessment of the firm’s capabilities, activities and potentialities to meet demand
relative to the capabilities and actions of the competing firms.

• 3) The competition:-
– this includes information about competing firms for forecasting own product
demand and making decision and plans to achieve the forecast, and depends on
past performance, present activity, future plane
• C) Internal information:-
• 1)Sale forecast:- all other internal plans of the firm
are guided by the sales plan, it is considered as the
dominant planning premise internal to firm.
• 2)The financial plan:-information on financial or
budget plan is important because it represents a
quantitative and time bound commitment about the
allocation of total resources- worker, plant, material,
overheads, administrative expenses of the firm.
• 3) Supply factors:-certain supply factors such as
• labour, capital, plant and equipment is important as
these factors play a vital role in developing the
financial plan.
• 4) Policies:-long-term basic policies on product
range, marketing, finance and about personnel.
• System:-
• Systems are diverse (different)-economic system,
computer system, decision-support system, solar
system, communication system, transport system,
educational system, we live in an era of system.
• A system is a group of elements or components
joined together to fulfill certain function in a large
context.
• A system is an assemblage of procedures,
processes, methods, routine techniques etc.
• A system is made up of sub-system. a sub-system
which is may be composed of further sub-system.
however a system itself is part of a super system.
The example of an industrial or factory
system
Super system

ABC
Other system

Production Sub-system-N
Sub-system-2

Material control Production control Quality control

Stores Inward Inspection

Purchase
 Transport Sys

Transport System

Public Transport Private Transport

Road Transport Air Transport Water Transport

System System System
• Characteristics Of System:
1)System have there own goal
If system does not use for proper reason then it’s a malfunctioning.

2) It is composed of elements & these elements can be system within system.

3)Elements may be common to several system at the same time

Eg. Skin = Provide Protection at same time i/p for impulse for nervous system

4)Elements in the system are interrelated & interdependent..

5) System has defined structure.

Flow of row material,feedback etc

6)Systems reacts to its environment

7) All system have life cycle.

Denotes : Birth, Evolution ,Growth ,Decay and Death

8)All system have boundaries.

Limits Of the system.
• What IS MIS ?

• 1)MIS is the system which makes available the right information to the
right person, at the right place, at the right time, in the right form and at the
right cost.

• 2)According to Davis and Olson, “MIS is an integrated user-machine

system for providing information to support operation, management and
decision-making functions in an organizations

• The system utilizes computer hardware and software manual procedures/

models for analysis, planning, control and decision-making and a
database”

• 3) According to Krober and Watson “ MIS is an organized set of processes

that provide information to managers to supports the operation and
decision-making within an organization”.

• 4)According to Henry c. Lucas, MIS is a set of organized procedures

which when executed provide information to support decision-making.
 The Concept of MIS

Judgment Skill External

Intuition Experience Environment
Processing Logic

Computers
Intelligence Design choice

Data
Human Beings
Data Decision Making Decision
Information
Data Data Base

Decision Implementation
MIS

Performance

Monitoring/ Feedback
• Why need of MIS
• MIS has become necessary due to the increased
business and management complexities.
• These complexities demand not only quantitative but
qualitative decision-making.
• All managers as we know have to take decisions
under condition of risk.
• A good manager/ decision-maker is one who
minimizes, if not eliminates altogether, the elements of
risk and uncertainty in decision-making.
• MIS is required to enable managers to take qualitative
decision and ensure success for their respective
organizations.
• MIS enables decision-maker to come out with
appropriate response to a business situation.
• MIS, thus, enables decision-maker to give
either a re-active or pro-active response.
• As however, the decision are also futuristic,
MIS facilitates pro-active decision- making- it
enables the manager/organization to be
ready for tomorrow, today.
• Objectives of MIS:-
• Management information system (MIS) is an
integrated man-machine system which
collect, maintains, correlated and selectively
display information in the proper time frame
consistently, and action taken for fulfilling
the objective of an organization.
• 1)Providing information to support
managerial functions( planning, control,
organizing, operating)
• 2)Collect information systematically and
routinely in according with a well defined set
of rules (Feedback)
• 3)Includes files, hardware, software and
operations research models of processing,
storing, retrieving and transmitting information
to the user.
• 4)Facilitate decision-maker to select the best
course of action.
• 5)Provide information at each level of
management to carry out their function.
• 6)Help in highlighting the critical factors to be
closely monitored for successful functioning of
organization.
• 7) Support decision-making.
• Characteristics of MIS :
• Management Oriented :
System designed from top to downwards. Other levels of
management are also provided with relevant information. Here
management orientation of MIS implies that the development of
information system efforts should start from an appraisal of
management needs and overall business objectives.

• Management Directed :
Because of management orientation of MIS, it is
necessary that management should actively direct system
development efforts. A one time involvement is not enough. To
ensure the effectiveness as per specifications of the designed
system, continued review by the management is must. In other
words, the management should be responsible for setting
system specifications., and it must play vital role in the
subsequent trade off decisions that occur in the system
development.
• Integrated :
Integration means system should be wholistic in its
approach. To cover all the functional areas of an
organisation .so as to produce more meaningful
management information, with a view to achieving the
objectives of an organisation. It has to consider
various sub–system , their objectives, information
needs, and recognize the interdependence that these
subsystem have among themselves , so that common
areas of information are identified and processed
without repetition and overlapping. In other words , an
integrated system that blends information from several
operational areas is a necessary element of an MIS.
• Common data flows :
Because of the integration concept of MIS, common –
data –flows concept avoids repetition and overlapping in data
collection and storage , combining similar functions, and
simplifying operations wherever possible. However , it may be
better to live with a little duplication to ensure system’s
acceptability and workability.
• Heavy planning element :
An MIS cannot be established overnight. It takes 3-5 years
or even more to establish it properly in an organisation.
Hence, long-term planning is required for MIS development
to fulfill the future needs and objectives of the organisation.
The designer of an MIS must ensure that it should not
become obsolete before it actually gets into operation.
• Sub-system concept:
even though the system is viewed as a single
entity , it must be broken down into meaningful
sub-system that can be implemented one at a
time.
Flexibility and ease of use :
While building an MIS system all types of
possible means which may occur in future are
added to make it flexible.
A feature that often goes with flexibility is the
ease of use. The MIS should be able to
incorporate all those features that make it readily
accessible to a wide range of users with easy
usability.
• Contemporary approaches to MIS
• We all live in an information age. Today information
technology has now become an integral parts of corporate
as well as personal life-style. Information systems based
on computer are now progressively used for acquiring,
processing, storing and disseminating (spread) information.
• Three type of contemporary (at the time) approaches
are
• 1) The technical approach
• 2) The behavioral approach
• 3) The socio-technical approach
• 1)The technical approach:-
• This approach is around mathematical and normative
models to study information system such as computer
science, management science and operation research
disciplines contribute significantly to the technical
approach.
• 2)The behavioral approach:-
• Information technology may heavily depend upon the
technical aspects/disciplines the developer has to
consider the behavioral impact/ response of people in
the organizations. information system be motivational
feasibility.
• 3) The socio-technical approach:-
• It is now realized that the problem faced while
developing and implementing information system are
neither purely technical nor behavioral it becomes
important to understand the perspectives of both
technical as well as behavioral disciplines this
approach is now being increasingly accepted and
implemented
• Information as a strategic resources
• Increasing and intensifying trends towards globalization,
competition is increasing and becomes more global.
• Global competition has increased performance standard
in many dimension covering the whole gamut of cost,
price, quality technology, productivity, product launch .
• Introduction time and smooth flowing operations.
• Present competitive environment strategic
competitiveness would have to be earned.
• It is in this overall context that information has emerged
as a strategic resources- resources that is scarce, has
significant cost and has alternative uses bestowing
(give) competitive edge on the organization which own it.
• Hence in the present competitive environment
information/knowledge has becomes a critical
organizational resource and is increasing considered/
accepted as a valuable strategic resources or as an
invaluable asset for competitive advantage.
• Use of information for competitive
advantage
• Highly competitive environment.
• Dramatic change have occurred in information
technology.
• Information revolution which is sweeping the
corporate organizations world-wide.
• The corporate business environment has
resultantly become competitive.
• Increasingly globalize and highly information-
based.
• Competitive advantage for a number of
corporate organizations.
• “Competitive advantage is about changing the
balance of power between a firm and its
competitors in the industry in the firm’s favor”.
• “Competitive advantage could be usually
embodied in either a product or a service that
has the most added value to customer and
that is unavailable from the competition”.
• Competitive advantage could also be seen “as
an internal system that delivers benefits to a
firm, not enjoyed by its competition”.
• MIS as an Instrument for the
organizational change
• Role of IT :
• Information Technology & Organisational
change:
• Global Networks:
Location factor becomes insignificant as
regards the business processes and
operations.Impying international division of
labor cost of global co-ordination declines
,transaction cost declines.
• Enterprise Networks:
• Enhances collaborative work and team work,
decline in the management cost, multiple task
can be work simultaneously from different
locations.
• Distributed Computing:
Leading to empormnet ,individuals and groups
have the information and knowledge to act .
Business processes can be streamline.
Management cost declines .Hierarchy and
centralization decreases.
• Portable computing:
Virtual organisation.Work is no longer time with
the physical location. Knowledge and
information can be delivered anywhere and
anytime they are needed. Work becomes
portable.
• Multimedia and graphical interface:
Accessibility becomes easiest even seniors can
access the information.organisational cost
decreases as work flow moves from paper to
digital image, document and voice. Complex
knowledge object can be made easier to
understand.
• History announced that mankind’s rise-
mankind’s success-depends upon man’s
ability to produce appropriate responses to
challenges of change.
• Produce an appropriate response.
• Challenges of change are too great.
• Realize that change management is the single
most important element that successful
business management to day.
• To remains competitive in the increasingly
aggressive markets, organization & individuals
working.
• Life live the present and carries the hopes of
the future.
• Quicker the hopes are turned in to reality.
• More satisfaction and sense of achievement.
• Faster the move with the time and even the
distant future- hope comes within life’s reach.
• Constantly changing demands due to rapidly
evolving technology.
• Dynamic markets.
• Increasingly sophisticated customer and
competitors.
 Leavitt model for Organizational change

Change
TASK

PEOPLE TECHNOLOGY

STRUCTURE