UNIT – I

Management Information Systems - An Overview

 Introduction to MIS- Meaning and Roles of MIS- 

Objectives of MIS – Characteristics of MIS – Application 

of MIS – Accounting and Finance Management - 

Marketing Management- Materials Management – 

Production Management -Personnel Management

Introduction to MIS

Today the need for an updated 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 excutive’s working and personal time is spent on recording, searching, absorbing and communicating information.

The Management Information System (MIS) is an integrated man-machine system that provides information to support the planning and control functions of managers in an organisation. 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 operations and for business planning.

Meaning and Definition of MIS

MIS

Management Information System

The Management Information System (MIS) is a concept of the last decade or two. It has been understood and described in a number ways. It is also known as the Information System, the Information and Decision System, the Computer- based information System.

The MIS has more than one definition, some of which are give below.

1. The MIS is defined as a system which provides information support for decisionmaking in the organization.

2. 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.

3. The MIS is defined as a system based on the database of the organization evolved for the purpose of providing information to the people in the organization.

4. The MIS is defined as a Computer . based Information System.

Definition of MIS

1. Facilitate the decisions making process by furnishing information in the proper time fame. This helps the decision maker to select the best course of action.

2. Provider requisite information at each level of management to carry out their functions.

3. Help in highlighting the critical factors to the closely monitored for successful functioning of the organisation.

4. Support decision making in both structured and unstructured problem environments.

5. Provide a system of people, computers, procedures, interactive query facilities, documents for collecting, storing, retrieving and transmitting information to the users.

Objectives of MIS

I. Management-oriented: The basic objective of MIS is to provide information support to the management in the organization for decision making. So an effective MIS should start its journey from appraisal of management needs, mission and goal of the business organization. It may be individual or collective goals of an organization. The MIS is such that it serves all the levels of management in an organization i.e. top, middle and lower level.

II. Management directed: When MIS is management-oriented, it should be directed by the management because it is the management who tells their needs and requirements more effectively than anybody else. Manager should guide the MIS professionals not only at the stage of planning but also on development, review and implementation stages so that effective system should be the end product of the whole exercise in making an effective MIS. III. Integrated: It means a comprehensive or complete view of all the sub systems in the organization of a company. Development of information must be integrated so that all the operational and functional information sub systems should be worked together as a single entity. This integration is necessary because it leads to retrieval of more meaningful and useful information. 

Characteristics of MIS

IV. Common data flows: The integration of different sub systems will lead to a common data flow which will further help in avoiding duplicity and redundancy in data collection, storage and processing. For example, the customer orders are the basis for many activities in an organization viz. billing, sales for cashing, etc. Data is collected by a system analyst from its original source only one time. Then he utilizes the data with minimum number of processing procedures and uses the information for production output documents and reports in small numbers and eliminates the undesirable data. This will lead to elimination of duplication that simplify the operations and produce an efficient information system. V. Heavy planning-element: The preparation of MIS is not a one or two day exercise. It usually takes 3 to 5 years and sometimes a much longer period. So the system expert has to keep 2 things in mind – one is that he has to keep future objectives as well as the firm’s information well in advance and also he has to keep in mind that his MIS will not be obsolete before it gets into action.

VI. Sub System concept:When a problem is seen in 2 sub parts, then the better solution to the problem is possible. Although MIS is viewed as a single entity but for its effective use, it should be broken down in small parts or subsystems so that more attention and insight is paid to each sub system. Priorities will be set and phase of implementation will be made easy. While making or breaking down the whole MIS into subsystems, it should be kept in mind that the subsystems should be easily manageable.

VII. Common database:This is the basic feature of MIS to achieve the objective of using MIS in business organizations. It avoids duplication of files and storage which leads to reduction in costs. Common database means a “Super file or Master file” which consolidates and integrates data records formerly stored in many separate data files. The organization of the database allows it to be accessed by each subsystem and thus, eliminates the necessity of duplication in data storage, updating, deletion and protection.

VIII. Computerized: MIS can be used without a computer. But the use of computers increases the effectiveness and the efficiency of the system. The queries can be handled more quickly and efficiently with the computerized MIS. The other benefits are accuracy, storage capacity and timely information.

IX. User friendly/Flexibility: An MIS should be flexible i.e. there should be room for further modification because the MIS takes much time in preparation and our environment is dynamic in nature.MIS should be such that it should be used independently by the end user so that they do not depend on the experts.

X. Information as a resource: Information is the major ingredient of any MIS. So, an MIS should be treated as a resource and managed properly

Role of MIS♣It can be compared with the heart in the body. 

That is, information is the blood and MIS is the heart.The system ensures that an appropriate data is ♣

collected from the various sources, processed and sent further to the needy destinations.

The system is expected to fulfill the information ♣

needs of individual, group of individuals, the management functionaries: the managers and top management.

The MIS satisfies the diverse needs through ♣

Query Systems, Analysis Systems, Modeling Systems, Decision Support Systems.

MIS helps in:-Strategic Planning♦

Management control♦

Operational control♦

Transaction processing♦

Helps Middle Management:-Short term planning♦

Target setting♦

Controlling the business functions.♦

Helps Top Management:-Goal setting♦

Strategic planning♦

Evolving the business plans and their ♦     implementations.

Application of MIS1. Personnel management2. Production management3. Financial management4. Material management5. Marketing management

It has a primary function of providing suitable manpower in number and certain ability, skill and knowledge, as the business organizations demands from time to time.

Its goal is to control personnel cost through continuous increase in manpower productivity by resorting the following techniques:

- HRD through training and upgrading the skills.- Motivation through leadership and job enrichment.- Promotion and rewards through performance appraisal.- Structuring the organization.

PERSONNEL MANAGEMENT

> Personal application form

> Appointment letter

> Attendance and leave records

> Bio data

> Appraisal form

> Productivity data on jobs

> Wages / salary agreement

> Record of complaints, grievance, accidents

> Industry data of wage, salary structure

>Industry data on manpower, skill, qualifications 

Its function has a primary objective of meeting the financial needs of the business, from time to time, by the way of providing working capital and long-term capital to run the business with the goal of containing the cost of the capital at minimum.

Declaration of audit financial results, submit all reports and returns to the Government and Tax authorities.

FINANCIAL MANAGEMENT

>Break-even analysis>Cost analysis>Cash flow projections>Ratio analysis>Capital budgeting and ROI analysis>Financial modeling>Management accounting>Expense analysis, auditing and control

FM Tools

> Quantity of Production with respect to a time period> Material requirement and its usage> Rejection quantity at each intermediate stage and the final stage> Breakdown incidence> Labour complement with respect to a period > Use of Power, fuel and Consumables.> Machine and facilities utilisation> Labour hours

ACCOUNTING

ACCOUNTING

> Attendance> Manpower> Leave> Salary/wages deductions> Loans and deductions> Accidents> Production data> Skills> Biodata> Family data

Marketing Management

It deals with satisfying the consumer. The scope of function starts from identifying the need of customer, evolving product concept, designing the product, positioning the product in market and selling in the appropriate price.Activities-Market researchConsumer surveyAdvertisingSales promotion campaignStocking of products

Materials Management

To provide material for production, maintenance and services at economical prices, in an appropriate quantity and quality with easy stock outs and with no extra cost of carrying the inventory.

The scope of materials management function is procurement, stocking control of inventory.

Input Transaction documents

> Purchase acquisition

> Purchase order 

> Receipt of goods

> Return of goods to supplier

> Issue for production

> Return from production> Certification of bill for payment

Production Management (PM) The Objective of PM function is, to 

provide manufacturing services to the organisation.>This involves the manufacture of products of a certain specified quality and within certain costs in a stipulated time fulfilling the promises given to the customer.>The PM function is supported by other functions, viz. Production Planning and Control, Industrial Engineering, Maintenance and Quality Control.

Input transaction documents

> Production Programme>Production Schedule>Process Planning Sheet>Job Card>Job status advice>Quality Assurance rating form>Finished goods advice>Breakdown advice>Material Requirement>Material Requisition>Customer order

MIS is the system, which makes available the right information to the:

Right Person At Right Place At right time In the right format/form At right cost.

Business Intelligence

The term Business Intelligence (BI) represents the tools and systems that play a key role in the strategic planning process of the corporation. These systems allow a company to gather, store, access and analyze corporate data to aid in decision-making. Generally these systems will illustrate business intelligence in the areas of customer profiling, customer support, market research, market segmentation, product profitability, statistical analysis, and inventory and distribution analysis to name a few.

Most companies collect a large amount of data from their business operations. To keep track of that information, a business and would need to use a wide range of software programs , such as Excel, Access and different database applications for various departments throughout their organization. Using multiple software programs makes it difficult to retrieve information in a timely manner and to perform analysis of the data.