Unit 1

Management
Information System
Management Information System
• The MIS is an integrated man machine system that provides
information to support the planning and control functions of
managers in an organisation.
Management
• Management has been viewed as be function, a process, a profession and
a class of people. It refers to the kind of task and activities that are
perform by managers. The specific nature of the activities is determined
by such managerial functions as planning, organizing, directing,
leadership and controlling.
1. Planning: It is the process of deciding in advance the courses of
action to be followed and when and how to undertake these. Its
objectives in the best possible manner and for anticipating future
opportunities and problems.
2. Organizing: It is formal grouping of people and activities to facilitate
achievement of the objectives. It is need for assigning responsibilities, jobs
and hierarchy among personnel.
Management
3. Directing: It is the process of activating the plans, structure and group
efforts desired direction. It is needed for implementation of plans by
providing desired leadership motivation and proper communication.

4. Controlling: It is the checking the progress of plans and correcting any

deviations that may occur along the way.
Management
• The management can be group into 3 hierarchical levels –
• Top or Strategic management
• Middle or Tactical management
• Junior or Operational management
1. Top Management: - It is establishing the policies, plans, objectives and budget
framework under which various departments will operate of the organisation.
2. Middle Management: - It has the responsibility of implementing the policies
and overall plans of the top management.
3. Junior Management:-It has the responsibility of implementing day to day
operations and decisions of the middle management to produce goods and
services to meet the revenue, profit and other goals.
Information
• Information is the result or product of processing data. Information can be
defined as the data which is organised and presented at a time and place so that
the decision-maker may take necessary act.
Information
• Information consists of data that has been retrieved, processed or otherwise used,
for informative or inferential purposes, arguments or as a basis for forecasting.

For example, some supporting documents, ledgers and so on, which comprise
source material for profit and loss statements may be used by the decision maker
for profit planning and control.
 System
• A system is a group of elements or components joined together to fulfil certain
functions.
• A system is made up of sub-system. The systems are either natural or man-made.
• A sub-system which may be composed of further sub-systems. A subsystem itself
is part of a super system.
• The given example is that of an industrial (or factory) system. It has various
subsystems such as production subsystem, marketing sub-system, personnel sub-
system and financial sub-system.
System
• The material sub-sub-system can be further broken down into ‘black
boxes’ such as purchasing, stores, transportation, inspection etc.
• This industrial system is a part of the large economic system of the
country which may be called as the super system.
• This relationship is shown in figure
Management Information System
• According to Schwartz, ‘MIS is a system of people, equipment,
procedure, documents and communication that collects, validates,
operates on transformers, stores, retrieves and present data for use in
planning, budgeting, accounting, controlling and other management
process’.
• According to Jerome Kanter, ‘MIS is a system that aids management in
making, carrying out and controlling decisions’.
• According to Davis and Olson, ’MIS is an integrated user machine system
designed for providing information to support operational control,
management control and decision making functions in an organisation.
The information systems make use of resources such as hardware,
software, man, procedures as well as suppliers’.
Objectives of MIS
•The goals of an MIS are to implement the organizational structure and
dynamics of the enterprise for the purpose of managing the organization in
a better way and capturing the potential of the information system for
competitive advantage.
•Following are the basic objectives of an MIS −
 Capturing Data − Capturing contextual data, or operational
information that will contribute in decision making from various
internal and external sources of organization.
Objectives of MIS
 Processing Data − The captured data is processed into information
needed for planning, organizing, coordinating, directing and controlling
functionalities at strategic, tactical and operational level. Processing
data means −
o making calculations with the data
o sorting data
o classifying data and
o summarizing data
Objectives of MIS
 Information Storage − Information or processed data need to be stored for
future use.

 Information Retrieval − The system should be able to retrieve this

information from the storage as and when required by various users.

 Information Propagation − Information or the finished product of the MIS

should be circulated to its users periodically using the organizational network.
Characteristics of MIS
•Following are the characteristics of an MIS −
 It should be based on a long-term planning.
 It should provide a holistic view of the dynamics and the structure of the
organization.
 It should work as a complete and comprehensive system covering all
interconnecting sub-systems within the organization.
 It should be planned in a top-down way, as the decision makers or the
management should actively take part and provide clear direction at the
development stage of the MIS.
 It should be based on need of strategic, operational and tactical information
of managers of an organization.
 It should also take care of exceptional situations by reporting such situations.
 Characteristics of MIS
 It should be able to make forecasts and estimates, and generate advanced
information, thus providing a competitive advantage. Decision makers can take
actions on the basis of such predictions.
 It should create linkage between all sub-systems within the organization, so that
the decision makers can take the right decision based on an integrated view.
 It should allow easy flow of information through various sub-systems, thus
avoiding redundancy and duplicity of data. It should simplify the operations with
as much practicability as possible.
 Although the MIS is an integrated, complete system, it should be made in such a
flexible way that it could be easily split into smaller sub-systems as and when
required.
 A central database is the backbone of a well-built MIS.
FRAMEWORK FOR MIS ORGANISATION
AND MANAGEMENT TRIANGLE
• Robert Anthony in 1965 suggested that the area of management planning
and control can be divided into 3 categories. These are:
1. Strategic planning.
2. Operational control.
3. Management control.

• Strategic planning: It develops the strategy for deciding objectives of the

organisation and introducing changes in those objectives, formulating
policies to govern procurement, use and disposition of those resources.
• Management control: It is needed by managers of a various departments to
measure the performance, decide on control action, formulate new decision
rules and allocate resources.
FRAMEWORK FOR MIS ORGANISATION
AND MANAGEMENT TRIANGLE
• Operational control: It is the processes of operational activities are carried
out to achieve optimum use of resources. It makes use of pre-established
procedures and decision rules.
Need and Importance of Management
Information System (MIS)
•A manager has to take decisions with two main challenges:
• First, a manager has to take quick decisions, or else there’s a chance of
the business being taken over by his competitors. The liberalization and
globalization, in which organizations are required to compete globally,
has further enhanced the necessity for such a system.
• Second, information is doubling up every two or three years, a manager
has to process a large voluminous data; failing which he may end up
taking a strong decision that may prove to be very costly to the
company.
•Hence, Management Information System has proved to be the one of the
most important in today’s business environment.
 Important roles of the MIS
 MIS satisfies the diverse needs through a variety of systems such as Query System,
Analysis System, Modelling System and Decision Support System.

 It helps in strategic planning, management control, operational control and

transaction processing.

 It helps in the clerical transaction processing.

 It answers the queries on the data pertaining to the transaction, the status of a particular
record and reference on a variety of documents.
Important roles of the MIS
 MIS for Junior Management: Providing the operational data for planning,
scheduling and control, and helps them further in decision-making at the
operation level to correct an out-of-control situation.

 MIS for Middle Management: In short-term planning, target setting and

controlling the business functions which is supported by the use of the
management tools of planning and control.

 MIS for Top- Level Management: in goal setting, strategic planning and
evolving the business plans and their implementation.

 It plays the role of information generation, communication, problem

identification and helps in the process of decision-making.
 Contemporary Approaches to MIS
• The study of information systems is a multidisciplinary field.
No single theory or perspective dominates.

• In general, the field can be divided into technical and

behavioral approaches.

• Information systems are sociotechnical systems. Though

they are composed of machines, devices, and “hard”
physical technology, they require substantial social,
organizational, and intellectual investments to make them
work properly.
 Contemporary Approaches to MIS-Technical
Approach
• The technical approach to information systems deals with the mathematical
side of models, as well as the physical capabilities and formal approach of the
systems. For example, management science emphasizes the development of
models for decision-making and management practices.

• The disciplines that contribute to the technical approach are computer science,
management science, and operations research.

• Computer science is concerned with establishing theories of computability,

methods of computation, and methods of efficient data storage and access.
Contemporary Approaches to MIS-Technical
Approach
• Management science emphasizes the development of models for
decision-making and management practices.

• Operations research focuses on mathematical techniques for optimizing

selected parameters of organizations, such as transportation, inventory
control, and transaction costs.
 Contemporary Approaches to MIS-
Behavioural Approach
• A growing part of the information systems field – does not ignore technology but
tends to focus on non-technical solutions concentrating instead on changes in
attitudes, management and organizational policy, and behaviour.

• For example, economics study how new IS change the control and cost structures
within the firm, and sociologists study the IS how groups and organisations shape
the development of systems and how the systems in turn affect individuals,
groups, and organizations.
• Issues such as strategic business integration, design, implementation, utilization,
and management cannot be explored usefully with the models used in the
technical approach. Other behavioral disciplines contribute important concepts
and methods.
 Contemporary Approaches to MIS-
Behavioural Approach
• For instance, sociologists study information systems with an eye toward how
groups and organizations shape the development of systems and also how
systems affect individuals, groups, and organizations. Psychologists study
information systems with an interest in how human decision makers perceive and
use formal information.
• Economists study information systems with an interest in what impact systems
have on control and cost structures within the firm and within markets.
• It concentrates on changes in attitudes, management and organizational policy,
and behavior.
Information as a Strategic Resource
• MIS should provide the relevant information that would help the
management in deciding the type of strategies the business needs.
• The strategy is directly related to the current status of business and the
goals to wishes to achieve.
• MIS is supposed to give a status with regard to whether the business is on
a growth path or is stagnant or is likely to decline.
• The continuous assessment of business progress in terms of sales, market,
quality, profit and its direction becomes the major role of MIS.
 Use of Information for Competitive
Advantages
• Competitive advantage through managing information can naturally grow to
an organization if it:
i. Manages information to reduce reaction time for change
ii. Managing information makes the organization efficient
iii. Information management leads to insights into the business that the
competitors cannot have.
iv. Information management is used for predictive analysis so that the
organization is one step ahead of competition
For example companies Google, dell etc. have generated an unparalleled
competitive advantage as their reaction time to changes in the market and
competition is much less.
 MIS as an instrument for the organizational
change
• MIS acts as an agent or a catalyst to bring about organisational change that is needed to
cope up with the changing business environment and the effect of external forces. MIS
has shifted from back office to front office.
• The role of the MIS in an organization can be compared to the role of heart in the body.
The information is the blood and MIS is the heart. In the body, the heart plays the role of
supplying pure blood to all the elements of the body including the brain.
• The system ensures that an appropriate data is collected from the various sources,
processed, and sent further to all the needy destinations.
• The system is expected to fulfill the information needs of an individual, a group of
individuals, the management functionaries: the managers and the top management.
MIS as an instrument for the organizational
change
• The MIS satisfies the diverse needs through a variety of systems such as Query
Systems, Analysis Systems, Modeling Systems and Decision Support Systems.
• The MIS helps in Strategic Planning, Management Control, Operational Control
and Transaction Processing.
• The MIS helps the clerical personnel in the transaction processing and answers
their queries on the data pertaining to the transaction, the status of a particular
record and references on a variety of documents.
• The MIS helps the junior management personnel by providing the operational
data for planning, scheduling and Controlling and helps them further in decision
making at the operations level to correct an out-of-control situation.
• The MIS helps the middle management in short-term planning, target setting and
controlling the business functions.
MIS as an instrument for the organizational
change
• It is supported by the use of the management tools of planning and control. The
MIS helps the top management in goal setting, strategic planning and evolving
the business plans and their implementation.
• The MIS plays the role of information generation, communication, problem
identification and helps in the process of decision making. The MIS, therefore,
plays a vital role in the management, administration and operations of an
organization.
Information Technology
• Twenty First century has been defined by application of and
advancement in information technology.
• According to Information Technology Association of America,
information technology is defined as “the study, design, development,
application, implementation, support or management of computer-
based information systems.”
• Information technology has served as a big change agent in different
aspect of business and society. It has proven game changer in resolving
economic and social issues.
Information Technology- Characteristics
• The development of Information Technology has made education
system simpler, easier, and widespread. Now days, technology can be
used for education and also avail benefits of adult education
• Development of remote areas
• Fast economic development
• Participation of public in governance and policy making
• The judiciary and other administrative services can also take the help
of technology to make work easier and faster
 Information Technology Characteristics
• Technology helps the police in nabbing the criminals
• Highly beneficial for the common people, as they can access their rights
and can take legal action against the person who violates his/ her rights.
• It increases the happiness and prosperity of not only an individual, but
rather the society as whole
• Digital proficiency in Information technology lower the costs, improve
operations and increase revenue.
• It adds new innovative methods for management of complexity,
improving quality and driving digital transformation.
 Emerging Trends in Information Technology

• User Interfaces
• User interface has undergone a revolution since introduction of
touch screen.
• The touch screen capability has revolutionized way end users
interact with application.
• Touch screen enables the user to directly interact with what is
displayed and removes any intermediate hand-held device like the
mouse.
• Touch screen capability is utilized in smart phones, tablet,
information kiosks and other information appliances.
 Emerging Trends in Information Technology

• Mobile Application
• Another emerging trend within information technology is mobile applications
(software application on Smart phone, tablet, etc.)
• Mobile application or mobile app has become a success since its introduction.
• They are designed to run on Smartphone, tablets and other mobile devices.
• They are available as a download from various mobile operating systems like Apple,
Blackberry, Nokia, etc. Some of the mobile app are available free where as some
involve download cost. The revenue collected is shared between app distributor and
app developer.
 Emerging Trends in Information Technology
• Cloud Computing
• One of the most talked about concept in information technology is
the cloud computing.
• Clouding computing is defined as utilization of computing services,
i.e. software as well as hardware as a service over a network.
Typically, this network is the internet.
 Emerging Trends in Information Technology
• Analytics
• The field of analytics has grown many folds in recent years.
Analytics is a process which helps in discovering the informational
patterns with data. The field of analytics is a combination of
statistics, computer programming and operations research.
• The field of analytics has shown growth in the field of data
analytics, predictive analytics and social analytics.
• Data analytics is tool used to support decision-making process. It
converts raw data into meaningful information.
• Predictive analytics is tool used to predict future events based on
current and historical information.
• Social media analytics is tool used by companies to understand and
accommodate customer needs.
Types Of Data
• Structured data
• Structured data adheres to a pre-defined data model. This
model describes how data is recorded, and it defines the
attributes and provides information about the data type (e.g.
name, date, number) and restrictions on their values (e.g.
number of characters). This level of organisation means that
data can be entered, stored, queried, or analysed by machines.
• Structured data includes:
• Names
• Dates
• Phone numbers etc.
Unstructured and Semi Structured Data
• Unlike structured data, unstructured data requires human
interpretation. Consider a block of text. Computers can read
each word, or sentence, but they can’t (yet) determine the
meaning or tone of the text without human intervention. As
you’ll discover later in the course, data scientists are trying to
solve this problem with machine learning and other types of
artificial intelligence.
• A semi-structured decision is one in which most of the factors
needed for making the decision are known but human
experience and other outside factors may still impact the
decision. A good example of a semi-structured decision is the
hiring process.
Big Data
Big data is a combination of structured, semistructured and
unstructured data collected by organizations that can be mined
for information and used in machine learning projects,
predictive modeling and other advanced analytics applications.
• Big data is often characterized by the three V's:
• the large volume of data in many environments;
• the wide variety of data types frequently stored in big data
systems; and
• the velocity at which much of the data is generated, collected
and processed.
Machine Data
• Machine data, sometimes called machine-generated data, is
the digital information that is automatically created by the
activities and operations of networked devices, including
computers, mobile phones, embedded systems, and connected
wearable products. In a wider context, machine data can also
include information generated by websites, end-user
applications, cloud-deployed programs, servers, and more.
• Machine data is processed according to a model called the
DIKW hierarchy, which stands for data, information, knowledge,
wisdom.
• The investigation and processing of machine data can drive
operations, security, and business analytics.
Real Time Data
• Real-time data refers to information that is made available for
use as soon as it is generated. Ideally, the data is passed
instantly between the source and the consuming application
but bottlenecks in data infrastructure or bandwidth can create
a lag. Real-time data is used in time sensitive applications such
as stock trading or navigation and it powers real-time analytics,
which brings in-the-moment insights and helps you quickly
react to changing conditions.
• Real-time data is applied in nearly every industry today. This is
because of the rapid pace of modern business, high customer
expectations for immediate personalization and response, and
the growth of real-time applications, big data, and the Internet
of Things (IoT).
Unverified Outdated Data
• Mike Bursell of Red Hat points to what he calls unverified
outdated data. This is data that has been collected, but nobody
has any idea whether it's relevant, accurate or even of the right
type.

• This data has no validation and accurateness .

• This data cannot be used for strategic and Managerial Decision

Making.

• This type of data are least used in managerial Purpose.

IT Capabilities and their organizational
impact

• IT Capability (information technology capability) refers to an

organization’s ability to identify IT meeting business needs, to deploy IT
to improve business process in a cost-effective manner, and to provide
long-term maintenance and support for IT-based systems. It is the
abilities to leverage different IT resource for intangible benefits.
IT Capabilities and their organizational
impact
• When the organization plays as a team i.e. the functions collaborate, positive value passes
between functions. In this case, the organization’s capability is greater than the sum of its
parts. The functions are better off together.

• When the organization does not play as a team i.e. is dysfunctional, then the value bleed is
negative. In this case, the organization’s capability is less than the sum of its parts. It follows
then that the functions are better off not being with each other!
• The net of this phenomenon is that no function within an organization would create the
same value within another organization.
IT Capabilities and their organizational impact: Components
IT Capability comprises of the following components:
• IT Strategy
• IT Processes and Metrics
• IT Organization
• Skills
• Structure
• Knowledge/ “know-how”
• Assets/Infrastructure
• Hardware
• Software
• Application
• Network
• Database
• Tools
An organization creates value by utilizing a unique
combination and configuration of these components
IT Enabled Services (ITes)
• IT enabled Services (ITeS), also called web enabled services or
remote services or Tele-working, covers the entire gamut of
operations which exploit information technology for improving
efficiency of an organization.
• These services provide a wide range of career options that include
opportunities in call Centre, medical transcription, medical billing and
coding, back-office operations, revenue claims processing, legal
databases, content development, payrolls, logistics management, GIS
(Geographical Information System), HR services, web services etc.
IT Enabled Services (ITes)
• Customer Interaction services -including call center facilities with
adequate telecom infrastructure, trained consultants, access to
requisite databases, Internet and other online information
infrastructure to provide information and support to customers
IT Enabled Services (ITes)
• Back office operations -data entry, data conversion including finance
and accounting and HR services.
• Transcription/Translation services
• Content development/animation/engineering/design and GIS
• Other services including remote education, data
search, market research, network consultancy and management
• The favored application areas are areas where there is huge amount of
data that needs to be processed and utilised for delivering the results, or
the data is the outcome of the service. In all cases, without use օf IT the
task would otherwise be unmanageable. Some of the most important
areas where IT enabled services can be deployed are:
 Transaction Processing System

• The system designed for processing day to day transaction in an organisation is

called TPS. This system deals with collecting and processing a large volume of
data which mainly helps junior level management in discharging their
responsibilities.
 Transaction Processing System: Characteristics and
its importance
• The main purpose of transition processing system is to records; process validates
& store transition death takes place in various function area of a business for
future retrieval of use.
• Transaction can be internal or external. When a department order office
supplies from the purchasing department an internal transaction occurs.
• When a customer places an order for a product an external transition occurs.
• This processing system is various used in this organisation such as finance
accounting, manufacturing, production human resources, marketing, Engineer
quality control and resource and development.
 Transaction Processing Systems: Characteristics
• The four important characteristics include
• Rapid response
• Fast performance is critical
• Turnaround time from transaction input to the production output must be a
few seconds or less
• Reliability
• Breakdowns disturb operations
• Failure rates must be low
• If failure occurs, recovery must be quick and accurate
• Inflexibility
• Every transaction must be processed in the same way
• Flexibility results in too many opportunities for non standard operations,
resulting in problems due to different transaction data
 Transaction Processing Systems: Characteristics
• Controlled processing
• Must support an organisation's operations
• If roles and responsibilities are allocated, the TPS should maintain these
requirements
• TPS systems reduce costs by reducing number of times data must be handled
• Two types, Batch and real time
Thank
You