Chapter-5

Development of MIS
Development Of Long Range Plans Of the MIS:
Any kind of business activity calls for long range plan for
success, the same is true for MIS.

The plan for development and its implementation is a basic

necessity for MIS.

The organization have invested in computers and expanded its

use by adding more or a bigger computers to take care of the
numerous transaction in the business.

In this approach, the information processing function of the

computers in the organization never got its due regard as an
important asset to the organization.
The computers have become user-friendly they can
communicate any systems and share data, information and
physical resources of other computers.

In short, we need a Management Information System flexible

enough to deal with the changing information needs of the
organization.

The plan of MIS is consistent to the business plan of the

organization. The information needs for the implementation of the
business plan should find place in the MIS.
Contents of MIS Plan:
A long range MIS plan provides direction for the development of
the systems, and provides a basis for achieving the specific targets
or tasks against the time frame.

The plan would have the following contents which will be dealt
by the designers under a support from the top management.
MIS Goals and Objective:
Provides an online information on the stock, markets and the
accounts balances.

The query processing should not exceed more than 3 seconds.

The focus of the systems will be on the end-user computing an

access facilities.

Information support will be the first in the strategic areas of the

management such as marketing or service or technology.
Business Plan versus MIS plan:
Business plan MIS Plan

Business goals and objective Management information system,

objectives, consistent to the business goals
and objectives.

Business plan and strategy Information strategy for the business plan
implementation playing a supportive role.

Strategy planning and decisions Architecture of the management

information system to support decisions

Management plan for execution and control System development schedule, matching
the plan execution.

Hardware and software plan for the

Operation plan for the execution procurement and the implementation.
Strategy for the plan achievement:
The designer has to take a number of strategic decisions for
the achievements of the MIS goals and objectives they are:
a)Development strategy: an online, a batch, a real time.
Technology platform.
b)System development strategy: any approach to the system
development - Operational versus Functional; accounting
versus analysis; data base versus conventional approach;
distributed versus decentralised processing; one data base
versus multiple databases SSAD v/s OOT.
c)Resources for system development: in house versus
external, customised development versus the use of packages.
d)Manpower composition: analyst, programmers skills and
know-how.
 
A model of the MIS plan
contents particulars focus
Corporate information Business environment on current Where are we?
operations. information on KRA

Corporate Current and new missions/goals/objectives. Where do we want to reach?

mission/goals/objectives

Business risk and Clear quantitative statements on these What is risk? Support information
rewards factors showing a trade off between the risk to resolve risk.
and rewards.

Details of the strategic and policy decisions How do we achieve the goals and
Business policy and affecting the business. objectives?
strategy
Strategic/planning, managerial operational What is the key information? CSF.
Information needs
Information technology details What are tools for achievements?
Architecture of the plan
Details of the systems and sub-systems and When and how will it be achieved?
Schedule of development their linkages charted against the time scale.

Manpower and delegation details. Internal Who will achieve it?

Organization and and external resources.
execution of the plan
Details on the investment schedule and How much will it cost? Budget and
Budget and ROI benefits. ROI.
Ascertaining the Class of Information
Organisational Information

One can define the organisational information as the

information required by a number of personnel, departments
and divisions or the functions in the organisation.

 Such information can be determined by constructing a matrix

of information versus user as shown in table .

It can be observed from the table that the information entity is
one, but its usages are different.
  
Matrix of information versus user for the personnel function:
Information entity manager manager manager manager
(personnel) (production) (administrator) (accouts)
Employees
Attendance X X X
Salary wages
And overtime X X X

Human resources
Information X X
-
Classes of information:
Information Examples of information User
classes
Organizational The number of employees, products, Many users at all the levels.
services locations the type of
business, turn over and variety of the
details of each one of these entities.

Functional Purchases, sales, production, stocks, Functional heads and others

Managerial receivables, payables, out standings,
budgets, statutory information.

Knowledge The trends in sales, production, Middle and top

technology. management.

Decision support Status information on particular Middle and operational

aspects, such as utilization, management.
profitability standard, requirement
versus availability.

Information on the production, sales, Operational management

Operational purchase, dispatches consumptions, and supervisor section
etc. officer.
Functional Managerial Information
The functional information is defined as a set of information required by the
functional head in conducting the administration and management of the
function.

This information is purely local to the function and by the definition, does not
have a use elsewhere.

This information is used by a manager to plan and control the function.

 
Work Design
For example, for the consumer order scrutiny the available stock, the price,
the terms of payment and the probable delivery is an information set evolved
out of the work design of customer order processing.

The procedure of the order processing requires this information.

Responsibility

The managers in the functional areas of the management

are responsible for achieving the targets and accomplishing
the goals and objectives .

It is, therefore necessary to inform and update the

information on target at regular intervals to enable him to
make or change decisions in his domain of operations.
Functional Objective

The total sales per month is Rs 10 million.

The finished goods inventory, not to exceed Rs 1

million.

The outstanding more than six months not to exceed Rs

0.2 million.

The capacity utilisation should be minimum 85

percent.

The employee attendance per month should be 99 per

cent.
Knowledge (An Information Set)
The knowledge creates an awareness of those aspects of business where
the manager is forced to think, decide and act.

Such an information shows the trend of the activity or a result against the
time scale.
 
Decision Support Information
Most of the information required by the middle and the top management is for
decision making.

The information does not act as a direct input to the decision making procedure
or formula but supports the manager in the efforts of decision making.
Operational Information

This information is required by the operational and the

lower levels of the management.

The main purpose of this information is fact finding and

taking such actions or decisions which will affect the
operations at a micro level.
 
Determining the Information Requirement
The sole purpose of MIS is to produce such
information which will reduce uncertainty risk in
an given situation.
The difficulty to determine a correct and
complete set of information is on account of the
factors given below:-
1)The capability constraint of the human being
as an information processor, a problem solver
and a decision maker.
2)The nature and the variety of information in
précised terms.
3)Reluctance of decision makers to spell out the
information for the political and the behavioral
reasons.
4) The ability of the decision makers
to specify the information.

In spite of these difficulties,

methods are evolved based on the
uncertainty scale, starting from the
low to the high level of uncertainty.
 Level of uncertainty Level of management Method

Low (Near Certainty) Operations management Ask questions such as,

what do you need?
Precise probabilistic Middle management Ask to express
know-ledge (A risk probability, Determine
situation) from the existing
systems and methods of
decision making and
problem solving.

Not able to determine in Determine through the

Middle and top management
probabilistic terms critical success factors,
precisely (Very risky) decision parameters and
decision methodology
Sensitivity analysis.

High (Total uncertainty) Top management Determine though

experimentation,
modeling and sensitivity
analysis.

Methods of Handling Uncertainty

 There are four methods of
determining the information
requirements. They are
1) Asking or interviewing
2) Determining from the existing
system
3) Analysing the critical success
factors
4) Experimentation and modeling.
1) Asking or Interviewing:-In this method
a designer of the MIS puts questions
or converses with the user of the
information and determines the
information requirements.
For example-”which are the raw materials
used for making a product”.
2) Determining from the Existing System:-
Here systems from other companies
can give additional information
requirements.
The managers in the operations and the middle
management use the existing systems as a
reference for determining the information
requirements.
3) Analysing the Critical Success Factors:-
Every business organization performs
successfully on efficient management of
certain critical success factors.
For example in a high technology
business, the management of the
technology becomes the critical function.
4) Experimentation and Modeling:-When
there is total uncertainty, the designer
and the user of the information resort to
this method for determining the
information requirement.
The experimentation would decide the
methodology for handling the complex
situation.
Development and Implementation of the MIS
The Development of MIS calls for
determining the strategy of
development.
Prototype Approach:-
When the system is complex, the
development strategy is Prototyping
of the system.
Prototyping is a process of
progressively ascertaining the
information needs ,developing
methodology, trying it out on a
smaller scale with respect to data
and the complexity ,ensuring that it
satisfies the needs of users and
assess the problems of development
and implementation.
Life Cycle Approach:-
There are many systems or
subsystems in the MIS which have
a life cycle, that is they have a birth
and death.
Their emergence may be a
sudden or may be a part of the
business need, and they are very
much structured and rule –based.
 BUSINESS Management Information System Development Model:
GOALS Prototype Approach

IDENTIFY
MODIFY
INFORMATION REFINE PROTOTYPE REVIEW
NEEDS THE NEEDS SPECIFICATIONS

DEFINE
DEVELOP
SYSTEMS DEVELOP AND IMPLEMENT
REVISED
BOUNDARIES TEST PROTOTYPE
AND SCOPE

IS
DEFINE THE USER NO TRAINING
INITIAL
SYSTEMS SATISFIED
PROTOTYPE
OBJECTIVES
YES
DEVELOP
INITIAL DEVELOP
EXAMINE PROTOTYPE MIS DOCUMEN-
FEASIBILITY SPECIFICATIONS WITH FINAL
SPECIFICATIONS
TATION
 Life Cycle Approach to the Development of MIS

SYSTEM PHYSICAL INSTALL

APPLICATION DESIGN THE SYSTEM

CONDUCT AWARE-
ASSESS SYSTEM
NESS AND
FEASIBILITY SPECIFICATION TRAINING

INFORMATION PROGRAM
OPERATE THE
REQ. ANALYSIS SPECIFICATION
SYSTEM

CONCEPTUAL DEVELOP REVIEW

DESIGN THE SYSTEM AND AUDIT
 Prototyping approach Life cycle approach

Open system with a high degree of Closed systems with little or no

uncertainty about the information needs uncertainty about the information needs.
The System remains valid for a long time
with no significant change. The design
would remain stable.

Necessary to try out the ideas, application

No need to try out the application of the
and efficiency of the information as a
decision support. information as it is already proven.

Scope of the design and the application is

Necessary to control the cost of the
design and development before the scope fully determined with clarity and
experimentations is not necessary.
of the system and its application is fully
determined.
Experimentation is necessary.
The user is confident and confirms the
specifications and the information needs.
User of the system wants to tryout the
system before he commits the
specification and the information
requirements. The system and application is universal
and governed the principles and
The system and application is highly practices.
custom oriented

Comparison of Approaches
 Implementation of the MIS
There are certain guidelines for the system
designer for successful implementation of the
system. The system designer should
1)Not question beyond a limit the information
need of the user.
2)Not to forget that his role is to offer a service
and not to demand them.
3)Remember that the system design is for the
use of the user and it is not the designer’s
prerogative to dictate the design features.
4) Not to mix up technical needs with the
information needs.
5)Impress upon the user the global nature of the
system design which is required to meet the
current and prospective information need.
6) Not to challenge the application of the information in
decision making.
7) Impress upon the user that the quality of information
depends on the quality of input.
8) Impress upon the user that you are one of the users in
the organization and that information is a corporate
resource and he is expected to contribute to the
development of the MIS.
9) Ensure that the user makes commitment to all the
requirements of the system design specifications.
10) Ensure that the overall system effort has the
management’s acceptance.
11) Enlist the user’s participation from time to time.
12) Realise that through serving the user, he is his best
guide on the complex path of development.
13) Not to expect perfect understanding and knowledge
from the user.
14) Impress upon the user that the change which is easily
possible in manual system, is not as easy in computer
system as it calls for changes in the programs at cost.
15) Impress upon the user that perfect information is non-
existent, his role has an importance in the organization.
16) Ensure that the other organization problems are
resolved first before the MIS is taken for development.
17) Conduct a periodical user meetings on systems where
you get the opportunity to know the ongoing difficulties of
the users.
18) Train the user in computer appreciation and system
analysis.

By implementation organizational transformation takes

place.
The Lewin’s method suggests three steps in this process-
The first step is Unfreezing the organization, the second
step is choosing a course of action and the third step is
freezing.
Management of information Quality in the MIS:

Information is a corporation resource, as important as

the capital, labour, know-how etc. and is being used for
decision making.

Its quality, therefore, is required to be very high.

A low quality information would adversely affect the

organisational performance as it affects decision making.
 Parameter of quality
Complete data of all the
transactions.
Valid transaction and input data
Accuracy and precision
Relevance to the user/decision
maker/stake holder
Timely information
Meaningful and complete
information
Examples
All involves of the month. All
vouchers of the month.
Only correct transaction types
are permitted in the system. Only in turn, assures a valid information.
that data which meet the design
specifications can be used.
Correct use of the formula or
procedure with relevant data.
It should be relevant to the user
for a decision making strategic
areas of business
Information on the sales
despatch, pending position.
Production information should
be reported in terms of quality,
quality and groups, or family,
and rejection and resource. It
should be given in a proper
format, with references.
comments
This achieves integrity of data with
respect to the time period.
Ensures the validity of the data and
Assures that the results are accurate
and precisely correct based on rule,
act or law using complete data.
If the relevant is appropriate the
quality required is high strong link
between business goal and MIS
goal.
If the information is received late it
becomes useless from a point of
view of
decision making.
Incomplete information forces the
user to infer or interpret
erroneously leading to a wrong
decision.
The quality of the parameters is assured if the following
steps are taken:

1.All the input is processed and controlled, as input and prices

design.
2.All updating and corrections are completed before the data
processing begins.
3.Inputs are subjected to validity checks.
4.The access to the data files is protected and secured through an
authorisation scheme.
5.Intermediate processing checks are introduced to ensure that
the complete data is processed right through, i.e., run to run
controls.
6.Due attention is given to the proper file selection in terms of
data, periods and so on.
7. Back-up of the data and files are taken to safeguard
corruption or loss of data.
8. The system audit is conducted from time to time to ensure
that the information system specifications are not violated.

9. The system modifications are approved by following a set

procedure which begins with authorisation of a change to its
implementation followed by an audit.

10. Systems are developed with a standard specification of design

and development.

11. Information system processing is controlled through

programme control, process control and access control.

12. Ensure MIS model confirms consistency to business plan

satisfying information needs to achieve business goals.
Organization for development of MIS:

Proper people organisation is basic to the management of any

activity or function.
The same thing is true for the development of the MIS.
The type, the size and the structure of corporate organisation
becomes the basis for the MIS organization for handling the
MIS function and management alternatives.
The major issues involved are:
1.Whether the MIS function should be handled as a centralised
activity.
2.The allocation of the hardware and the software resources.
3.The maintenance of the MIS service level at an appropriate
level.
4.Fitting the organisation of the MIS in the corporate
organization, its culture and the management philosophy.
MIS: Development process model
Features contributing to success:

The MIS is integrated into the managerial functions. It sets clear

objectives to ensure that the MIS focuses on the major issues of
the business. Also adequate development resources are provided
and the human and organizational barriers to progress are
removed.

An appropriate information processing technology, required to

meet the data processing and analysis needs of the users of the
MIS, is selected.

The MIS is oriented, defined and designed in terms of the user’s

requirements and its operational viability is ensured.
The MIS is kept under continuous surveillance, so that its open
system design in modified according to the changing
information needs.

MIS focuses on the business results and goals, and highlights

the factors and reasons for non-achievement.

MIS is not allowed to end up into an information generation

mill avoiding the noise in the information and the
communication system.

The MIS recognises that manager is a human being and

therefore, the systems must consider all the human behavioural
factors in the process of the management.
The MIS is easy to operate and therefore, the design of the
MIS has such features which make up user-friendly design.

MIS recognises that the information needs become obsolete

and new needs emerge.
 Technology upgrade
decisions

Information system
planning

training

Management and
Executive role development

Running day to day

operations, back up

system maintenance,
s/w maintenance
Centralized organization of MIS
Features contributing to failure:

The MIS is conceived as a data processing and not as an

information processing system.
MIS does not provide the information which is needed by
the managers but it tends to provide the information generally
the function call for. The MIS then becomes impersonal
system.
Under estimating the complexity in the business system and
not recognising it the MIS design leads to problem in the
successful implementation.
Adequate attention is not given to the quality control ascents
of the inputs, the process and the outputs leading to
insufficient checks and controls in the MIS.
The MIS is developed without streamlining the business
processing systems in the organization.

Lack of training and appreciation that the users of the

information and the generators of the data are different, and they
have to play an important responsible role in the MIS.

The MIS does not meet certain critical and key factors of its
users such as a response to the query on the database, an inability
to get the processing done in a particular manner, lack of user-
friendly system and the dependence on the system development
personnel.

Belief that the computerised MIS can solve all the management
problems of planning and control of the database.
Lack of administrative discipline in following the
standardised systems and procedures, wrong coding and
deviating from the system specifications result in incomplete
and incorrect information.

The MIS does not give perfect information to all the users in
the organization. Any attempt towards such a goal will be
unsuccessful because every user as a human ingenuity, bias,
certain assumptions not known to the designer. The MIS
cannot make up these by providing perfect information.
Approaches to MIS development:
1.Identify business codes.
2.Determine critical success factors.
3.Develop business strategy and IS strategy.
4.Identify critical business applications.
5.Make decision analysis and enumerate operational and strategic
decisions.
6.Develop business performer indicator.
7.Identify information entities to decision support for business.
8.Determine IS structure to generate information to build MIS.
9.Build MIS super set as prescribed in general model of MIS.
MIS development process model:

1.Study the business environment.

2.Study the organization and structure.
3.Identify mission and business goals.
4.Identify critical success factors.
5.Ascertain the business strategy.
6.Identify business decision needed to implement strategy.
7.Develop key performance indicators to measure the business
progress and performance.
8.Determine MIS goals supporting business goals.
9.Identify the data and information needs meeting the MIS goals.
10.Develop IS and IT strategy to meet the goals
11. Determine IS and IT support structure to meet data
and information needs.
12. Determine MISs super set.
13. Link and map MISs and information outcome to
business goals and strategy.
14. Design information reporting structure
 Periodic reports
 Exception reports
 Control reports
15.design KMS and BI systems.
 
 Management of h/w
and s/w

Selection of hardware
solution

Selection of language,
Advisoty OS
role

Assist users in system

development

Training and problem

solving
DeCentralized organization of MIS