Introduction to

Management Information
System (MIS)
 Outline of the chapter
Management Information System
(MIS)

Introduction
:
• Data
• Information
Managemen
• Information t
technology Information Subsystem:
System • Transaction Processing
• Information
• Definition System (TPS) Contemporary
System
• Importance • Management Reporting Approaches
System (MRS) Technical Approach
• Decision Support system Behavioral Approach
(DSS) Evolution of
Sociotechnical Approach.
Information
Age
Introduction: How?

• How to improve the

quality of decision
making?
• List the basic resource for
Business.
 Introduction: Data Vs Information
• Data are facts or figures in a
raw, unprocessed format.
• Data consist of
• numbers,
• letters,
• symbols,
• raw facts,
• events and transactions,
which recorded but not yet
processed into the form that
is suitable for making
decisions.
 Introduction: Data Vs Information
• To become useful to decision
maker, data must be transformed
into Information
• Information is data that has been
processed in such a way that has
a meaning to the persons who
receives it.
• This person may be use this
information to improve the quality
of decision making.
• The relationship between data and
information is similar to that of
raw materials and the finished
product.
 Introduction: Information
• Information is a vital requirement
with any business and is required
both internal and external. • Various third parties
• For instance, management require information
requires information: about the business,
including:
• To provide records, both current and • The owner
historical (shareholder)
• To analysis what is happening within • Customers
the business • Suppliers
• To make an informed decision • Government agencies
• To monitor the performance of the
business.
 Introduction: Information
Test your understanding 1.
A working definition of information
would be
A. Facts you can work with
B. Facts
C. Facts useful to production Manger
D. Facts useful for decision maker
 Introduction: Characteristics of Good Information

The information should have the

following Characteristics
(identified by the acronym
ACCURATE). 4. Understandable –
1. Accurate – Sufficiently clearly presented and
accurate to be relied upon. displayed in an
understandable form.
2. Complete – Manager should
be given all the information 5. Relevant – relevant to
they need, but not excessive. its purpose.
3. Cost Effective – the value of 6. Timely – provide in
information should exceed sufficient time for
the cost of producing it. decision to be made.
7. Easy to use – clear and
easy to use
Introduction: Characteristics of Good Information

Test Your Understanding 2

Consider the following statements
(i) Good information must be obtained
cheaply
(ii) Good information should be
excessive.
Which of the above statement is/are
correct?
A. (i) only
B. (II) only
C. Both
D. Neither
Introduction: Information Technology
Vs Information System
Information Technology
(IT) describes any
equipment concerned with
the capture, storage,
transmission or
presentation of information.
Information System (IS)
refers to the provision and
management of information
to support the running of
the organization.
 Introduction: Information Technology
Vs Information System
Information System Information Technology
(IS) (IT).
Focus
Enable the effective use Enable data processing and
of data to support communication
business operation.
Scope It includes software and
It includes technology, hardware.
process and person
 Management Information System
(MIS)
• 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.
• Management Information System (MIS)
• Management: covers planning,
organizing, and controlling the
business operation
• Information: is data that is used for
the management function.
• System: accepting input, processing it, and
producing output.
 Management Information System
(MIS)
• Management Information System
(MIS) can be defined as "a system
providing management with accurate
and timely information necessary to
facilitate the decision-making
process and enable the organization's
planning, control, and operational
functions to be carried out
effectively
• MIS is a computer-based information
system that provides for
management-oriented reporting
based on transaction processing and
business operations of the
 Management Information System
(MIS)
• Management Information System
(MIS) provides information to all
levels of management to enable
them to make timely and effective
decisions for planning and
controlling the activities for which
they are responsible
• The primary goal of this system is to
collect and organize all data from
various levels of an organization, and
summaries, and then facilitate
decision-making, and improve quality
to increase the company’s productivity
and profitability
 Importance: Management Information
System (MIS)
• What if a management may face a
challenging and quick decision?
• What if the management may process
a large volume of data to make a
decision?
• In this information age, organization
cannot survive and grow without
properly planned, designed MIS.
 Importance: Management Information
System (MIS)
MISs allow businesses to have access to
accurate data and powerful analytical
tools to identify problems and
opportunities quickly and make decisions
accordingly.
1. To record the transactions and activities:
collect and store the big data.
2. To reduce operating cost: no need a
space in office to store a paper no search
for lost record.
3. To improve efficiency ant productivity:
finding a data in lowest time
4. To support better management decision:
 MIS –

Test your Understanding 3

• Which two of the following statements are
correct?
A. MIS is an information technology
B. It is difficult to apply at the operational
levels of an organization.
C. MIS gathers data from internal sources
only.
D. It allows data processing once collected.
E. It has a database for future use
 MIS –
Test your Understanding 4
Discuss the importance of MIS on
A. to reduce the operating cost
B. to improve the efficiency and operation
C. to ensure regulatory compliance
D. to minimize litigation risks
E. to safeguard vital information
F. to support better management decision-
making
 Subsystems of MIS

• Systems may consist of

numerous sub-systems, each
of which has elements, Following are the subsystems of
interactions, and objectives. the Management Information
• Subsystems perform System:
specialized tasks related to the 1. Transaction Processing
overall objectives of the total System
system. A system exists on more 2. Management Reporting
than one level and can be System
composed of subsystems or 3. Decision Support System
element parts
4. Office Information System
5. Business Expert System
 Subsystems of MIS - Transaction
Processing System
• TPS records historic information
and represent simple automation
of manual system
• The TPS routinely capture,
process, stores and output the
transaction data.
• For example, a TPS could be
used in supermarket to record
the sales of the products.
• At the end of each day, it could
produce a summary of how
many product are sold.
 Subsystems of MIS – Management
Reporting System
• MRS are most elaborate of
management-oriented MIS
components.
• A MRS provides information- in the
shape of reports or statements.
This system helps management by
providing them with real-time and
relevant information.
• It is used to maintain operational
and management control of the
enterprise.
• MRSs provide periodic reports,
exception reports or Ad-hoc
 Subsystems of MIS – Decision Support
System
• DSS give direct computer support to
managers during the decision-
making process.
• For example, an advertising
manager may use a DSS to perform
a what-if analysis as part of the
decision to determine how to spend
advertising dollars.
• A production manager may use a
DSS to decide how much product to
manufacture, based on the expected
sales associated with a future
promotion.
 Subsystems of MIS – Office Information
System
• OFS is an information system that
uses hardware, software, and
networks to enhance workflow and
better communication between
employees.

• 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.
 Subsystems of MIS – 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.

• The expert system provides decision

support to managers in the form of
advice from an expert in a specific
problem area.
• It allows non-experts to interrogate
them for information, advise and
recommendation decisions.
 Subsystems of MIS –

Test your Understanding 5

• An accountant will input the relevant
information about the client’s circumstance
to calculate personal tax liability. The
system will then access its database of rule
and regulation about personal tax, decide
which rules apply to the client and then use
them to calculate a tax liability
• Which Subsystems of MIS
A. TPS C. DSS
B. EIS D. OFS
 Subsystems of MIS –

Test your Understanding 6

A. TPS B. DSS C. EIS D. OFS E. MRS
Required:
(i.) Converts information about basic
transactions into reports that will help tactical
managers control the organization.
(ii.) Records all daily transactions within the
organization
(iii.) A tailor-made system that will draw on
internal and external information to help deal
with unstructured or semi-structured
problems.
 Subsystems of MIS –

Test your Understanding 7

Define the term
A. System
B. Sub-system
C. Closed Vs Open System
Components of MIS

To enable decision-
making, the MIS
consists of four
primary components
that equip managers
with essential
information.
 Components of MIS
Hardware refers to the physical
components of MIS, such as
computer, server or other device.
The software includes the
programs or applications used to
process and analyze data.
Data is collected from various
sources and processed with
advanced techniques.
People are users responsible for
collecting, processing and analyzing
data
 Contemporary Approach to MIS

• There are a number of ways we

can look at (MIS), the major ways
in which we can consider MIS are
technical and behavioral
approach as well as
sociotechnical approach.
• No single theory or perspective
dominates, we can apply the MIS
function into different
perspective.
 Contemporary Approach to MIS-
technical approach
• The technical approach to IS
emphasizes mathematically
based models to study
information system, as well as
the physical technology and
formal capabilities.
• The disciplines that contribute to
the technical approach:
• Computer Science
• Management Science
(Operation Research).
 Contemporary Approach to MIS-
Behavioral Approach
• An important part of MIS field is
concerned with behavioral
issues: Sociologist (how groups
• This approach deals with: and organizations shape
• Design the development of the
• Implementation system)
• Business Integration Psychologists (how
• Management
human decision makers
perceives and use formal
information)
Economist: (how IT
systems affect control
structures and costs both
 Contemporary Approach to MIS-
sociotechnical System

Sociotechnical view of systems

optimal organizational
MIS should be both
performance is achieved by jointly
Technical and
optimizing both the social and behavioral
technical systems used in
production.
Both the technical and
behavioral components need
attention. This means that
technology must be changed and
designed in such a way as to fit
 Evaluation Information Age
 Agricultural Age: The period up to the
1800s, when the majority of workers
were farmers whose lives revolved
around agriculture.
 Industrial Age: The period from the
1800s to 1957, when work processes
were simplified through mechanization
and automation.
 Information Age: The period that
began in 1957, in which the majority of
workers are involved in the creation,
distribution, and application of
information.
Knowledge Workers: Workers
 Evaluation Information AGE

 Information Age also known as

computer Age, Digital Age, or New
Media Age.

 is a period in human history

characterized by the shift from
traditional industry that the
Industrial Revolution brought through
industrialization, to an economy based
on information computerization.
 Evaluation Information AGE

• During the information age, the

phenomenon is that the digital industry
creates a knowledge-based society
surrounded by a high-tech global
economy that spans over its influence
on how the manufacturing throughput
and the service sector operate in an
efficient and convenient way
 Information Age

Test your Understanding 8

1. What information age makes different
from other ages? Describe the
characteristics of the Information Age.
2. Define information technology, what
components are there in IT.