Introduction to
Management Information
System (MIS)
Outline of the chapter
Management Information System (MIS)
Introduction:
• Data
• Information
• Information Management
technology Information Subsystem:
• Information System • Transaction Processing
System • Definition System (TPS)
• Importance Contemporary
• Management Reporting Approaches
System (MRS) Technical Approach
• Decision Support system Behavioral Approach
(DSS) Sociotechnical Approach. Evolution of
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 requires require information
information: about the business,
including:
• To provide records, both current and • The owner (shareholder)
historical • Customers
• To analysis what is happening within the • Suppliers
business • Government agencies
• To make an informed decision
• 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).
1. Accurate – Sufficiently accurate 4. Understandable – clearly
to be relied upon. presented and displayed in
an understandable form.
2. Complete – Manager should be
given all the information they 5. Relevant – relevant to its
need, but not excessive. purpose.
3. Cost Effective – the value of 6. Timely – provide in
information should exceed the sufficient time for decision
cost of producing it. 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 (IS) Information Technology (IT).
Focus Enable the effective use of Enable data processing and
data to support business communication
operation.
It includes software and
Scope 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
organization
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:
provide relevant data to the decision maker
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, interactions, and Following are the subsystems of the
objectives. Management Information
• Subsystems perform specialized System:
tasks related to the overall 1. Transaction Processing System
objectives of the total system. A 2. Management Reporting System
system exists on more than one level 3. Decision Support System
and can be composed of 4. Office Information System
subsystems or element parts 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 reports.
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:
• This approach deals with: Sociologist (how groups and
• Design organizations shape the
• Implementation development of the system)
• Business Integration Psychologists (how human
• Management decision makers perceives
and use formal information)
Economist: (how IT systems
affect control structures and
costs both within a company
and in markets)
Contemporary Approach to MIS-
sociotechnical System
Sociotechnical view of systems
optimal organizational performance is
achieved by jointly optimizing both MIS should be both
Technical and behavioral
the social and 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 organizational and individual
needs.
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
involved in the creation, distribution,
and application of information.
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.