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 An information system is an organized combination of
people, hardware, software, communications Networks
and data resources that collects, transforms, and
disseminates/circulate/, information in an organization.

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MANAGEMENT INFORMATION SYSTEM(MIS)

 “The MIS is defined as a system which provides

information Support for decision making in the
organization. ”
 “The MIS is defined as a system based on the database of
the evolved for the purpose of providing information to
the people in the organization.”

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 Management information systems are distinct from
regular information systems in that they are used to
analyze other information systems applied in operational
activities in the organization. MIS involve three primary
resources: technology, information, and people.

 Management information systems are regarded to be a

subset of the overall internal controls procedures in a
business, which cover the application of people,
documents, technologies, and procedures used by
management accountants to solve business problems such
as costing a product, service or a business-wide strategy.

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 Objective of MIS
 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.
 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:
 ·         making calculations with the data
 ·         sorting data
 ·         classifying data and
 ·         summarizing data
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 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.

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The primary purpose of a management information system, or
MIS, is to assist managers in making strategic, tactical and
operational decisions in an efficient and productive manner. It
provides managers with essential information that is gathered
from a variety of sources, pooled into a single database and
compiled in a readable format.
A management information system consists of a set of systems
and processes that distributes information to managers. This
tool is used to make reports and comprehensive overviews that
help managers conduct performance reviews and make a wide
range of decisions, such as an in-depth analysis of operational
concerns. It provides internal reports that are presented in an
easily understandable format. Information collected by a MIS
are either financial or operational depending on the needs of
management.

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A MIS is generally capable of collecting any type of information
required by managers. It views financial data, such as daily
expenses and revenues, and attributes these data to respective
departments. Personnel are able to manage outgoing shipments
and incoming deliveries from any location connected to the MIS.
 Front-line employees also use MIS to perform their jobs more

effectively. For example, employees consult a MIS to view statistics

related to their department or check on the status of particular
inventory items. Furthermore, management information systems
facilitate communication and collaboration by allowing employees
to share documents and important information.
 Most management information systems rely on technology to

collect and compile data. Some companies use standard systems,

while others develop unique systems that suit their specific
operations.

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 The role of 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 MIS plays exactly the same role in the organization.

 The system ensures that an appropriate data is collected

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

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 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.

 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.

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 Management-oriented: The basic objective of MIS is to
provide information support to the management in the
organization for decision making.
 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.
 Integrated: It means a comprehensive or complete view of all
the subsystems in the organization of a company.

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 Common data flows: The integration of different
subsystems will lead to a common data flow which will
further help in avoiding duplicacy and redundancy in data
collection, storage and processing.
 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.
 Subsystem concept: When a problem is seen in 2 sub
parts, then the better solution to the problem is possible.

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 Common database: This is the basic feature of MIS to
achieve the objective of using MIS in business organizations.
 Computerized: MIS can be used without a computer. But the
use of computers increases the effectiveness and the
efficiency of the system.
 User friendly/Flexibility: An MIS should be flexible.
 Information as a resource: Information is the major
ingredient of any MIS.

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  Timeliness
 Accuracy

 Consistency

 Completeness

 Relevance

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1) Marketing Research System (MRS)
Marketing research can be seen as the systematic and
objective search for and analysis of data and information
relevant to the identification and solution of any problem in
the field of marketing.

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2) Marketing Intelligence System (MIS)
The process of acquiring and analyzing information in order to
understand the market (both existing and potential customers);
to determine the current and future needs and preferences,
attitudes and behavior of the market; and to assess changes in
the business environment that may affect the size and nature
of the market in the future.

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3) Internal Record System (IRS)
Marketing managers rely on internal reports on orders, sales,
prices, costs, inventory levels, receivables, payables, and so
on. By analyzing this information, they can spot important
opportunities and problems.

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4) Decision Support System(DSS)
A decision support system (DSS) is a computer-based
information system that supports business or
organizational decision-making activities. DSSs serve the
management, operations, and planning levels of an
organization and help to make decisions, which may be
rapidly changing and not easily specified in advance.

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 The main aim of MIS is to inform management and help
them make informed decisions about management and the
way the business is run.

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 Transaction processing systems: These systems process a
large volume of routine, recurring transactions.
 Operations information systems: These systems gather
comprehensive data, organize it and summarize it in a form
that is useful for managers.
 Decision support systems: These systems help mangers with
the necessary information to make intelligent decisions.
 Expert systems: They are meant to mimic humans in making
decisions in a specific field.

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1.Hardware
2.Software
3.Control
4.Databases and application programs
5.People
6.Telecommunications and Networks

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 Scheduled reports which are
produced periodically, or on a
Schedule (daily, weekly, monthly).

 Key-indicator report which

summarizes the previous day’s
critical activities and also it is
typically available at the beginning
of each day.

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 Demand Report which
gives certain information
at a manager’s request.

 Exception Report which

is automatically produced
when a situation is
unusual or requires
management action.

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 It improves personal efficiency.
 It expedites problem solving(speed up the progress of
problems solving in an organization).
 It facilitates interpersonal communication
 It promotes learning or training.
 It increases organizational control.
 It generates new evidence in support of a decision.
 It creates a competitive advantage over competition.
 It encourages exploration and discovery on the part of the
decision maker.
 It reveals new approaches to thinking about the problem
space.
 It helps automate the Managerial processes

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Nature and Scope of MIS
The following diagram shows the nature and scope of MIS:

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MIS - Classification of Information

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• Data may be made available from management
information systems on a company’s intranet
• Employees can use browsers and their PC to gain
access to the data

Functional Aspects:
MIS is an integrated collection of functional information
systems, each supporting particular functional areas.

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 Internet An Organization’s
MIS

Financial
MIS
Business
transactions

Drill down reports

Accounting
Transaction Databases MIS Exception reports
processing of
Demand reports
systems valid
transactions Key-indicator reports
Marketing
MIS Scheduled reports

Business
transactions Databases Human
of
Resources Etc.
external
data MIS
Extranet
Etc.

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 Financial
Databases of
internal data
Databases of DSS
external data

Business
transactions Transaction Databases
processing of valid
Financial
systems transactions MIS Financial
for each applications
TPS databases

Business
transactions
Financial statements
Financial
Operational Uses and management ES
Internet databases of funds
or
Extranet

Customers,
Business Suppliers
transactions

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 Inputs to the Financial Information System:
Strategic plan or corporate policies
Contains major financial objectives and often projects financial needs.
Transaction processing system (TPS)
Important financial information collected from almost every TPS -
payroll, inventory control, order processing, accounts payable,
accounts receivable, general ledger.
External sources
Annual reports and financial statements of competitors and general
news items.
Financial MIS Subsystems and Outputs:
Financial subsystems
• Profit/loss and cost systems
• Auditing
• Internal auditing
• External auditing
• Uses and management of
funds

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Manufacturing MIS:
Databases of Manufacturing
Databases of
internal data external data DSS

Business
transactions
Transaction Databases
processing of valid
Manufacturing
systems transactions MIS Manufacturing
for each applications
TPS databases

Business Quality control reports

transactions
Process control reports Manufacturing
Operational ES
JIT reports
Internet databases
MRP reports
or
Extranet Production schedule

Business Customers,
transactions Suppliers

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Inputs to the Manufacturing MIS:

Strategic plan or corporate policies.

The TPS:
• Order processing
• Inventory data
• Receiving and inspecting data
• Personnel data
• Production process
External sources
Manufacturing MIS Subsystems and Outputs:

• Design and engineering

• Master production scheduling
• Inventory control
• Manufacturing resource planning
• Just-in-time inventory and manufacturing
• Process control
• Computer-integrated manufacturing (CIM)
• Quality control and testing

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Marketing MIS:
Supports managerial
Databases of Manufacturing
activities in product Databases of
DSS
internal data external data
development, distribution,
pricing decisions, and
promotional effectiveness

Transaction Databases
Business processing of valid
Marketing
transactions systems transactions MIS Marketing
for each applications
TPS databases

Sales by customer

Sales by salesperson Manufacturing

Operational Sales by product ES
databases Pricing report

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 Inputs to Marketing MIS:
• Strategic plan and corporate policies
• The TPS
• External sources:
•The competition
•The market

Marketing MIS Subsystems and Outputs:

• Marketing research
• Product development
• Promotion and advertising
• Product pricing

Human Resource MIS:

Concerned with all of the activities related to employees and potential employees
of the organization

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