Management Information System – Catalyst in Decision Making

I NT RO DU CT IO N

The human intelligence is closely

related with the human experience and
decision making skills which is strongly
backed by information's. Now a day's in
every field of human working right
information is considered as the most
important resource of good decision
making. Every organization runs by the
managers of organization, who are
making decisions in every step of
organizational activities.

Due to the importance of information in decision making a separate field has emerged
to serve the appropriate information's to managers for effective and good decision
making purpose. Serving the suitable information use to pass through a process called
management information system as the information is using to make management
decisions.

Initially in businesses and other organizations, internal reporting was made manually
and only periodically, as a by-product of the accounting system and with some
additional statistic(s), and gave limited and delayed information on management
performance.

Previously, data had to be separated individually by the people as per the requirement
and necessity of the organization. Later, data was distinguished from information, and
so instead of the collection of mass of data, important and to the point data that is
needed by the organization was stored.

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 Management Information System – Catalyst in Decision Making

Earlier, business computers were mostly used for relatively simple operations such as
tracking sales or payroll data, often without much detail. Over the time, these
applications became more complex and began to store increasing amount of
information while also interlinking with previously separate information systems. As
more and more data was stored and linked man began to analyze this information into
further detail, creating entire management reports from the raw, stored data.

The term "MIS" arose to describe these kinds of applications, which were developed to
provide managers with information about sales, inventories, and other data that would
help in managing the enterprise.

Today’s managers depend on information systems for decision making. The managers
have handful of data around them but manually they cannot process the data accurately
within the short period of time available to them due to heavy competition in modern
world. Therefore managers depend on information systems.

The main purpose of management information system is to ensure the flow of

appropriate information to the appropriate people of organization as well as parties
related with organization. So that they can (Internal and external decision makers) can
make good decisions for running the organization. The entire process objective is to
provide complete, timely, reliable and quality information's to the decision makers.

In big organizations the computer department responsible for providing information's

also called MIS department. Traditional management information system is slower than
computer based information system because the entire procedure executes manually.

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 Management Information System – Catalyst in Decision Making

THE CO NC EPT O F MIS

• Management has been defined in a variety of ways, but for our purposes it
comprises the process or activities what managers do in the operation of their
organization: Plan, Organize, Initiate and Control operations.

• Information
(Data vs Information)

The frequency of the use

of the words data and
information are very high
in our daily lives.
Depending on the context
the meanings and use of
these words differ. Both
data and information are types of knowledge or something used to attain
knowledge. Though used interchangeably, there are many differences between
the meanings of these two words.

Data are facts and figures that are not currently being used in a decision
processes and usually take the form of historical records that are recorded and
filed without immediate intent to retrieve for decision making.

Information consists of data that have been retrieved, processed or otherwise

used for information or inference purposes, argument, or as a basis for
forecasting or decision making.

• An 'MIS' is a planned system of the collection, processing, storage and

dissemination of data in the form of information needed to carry out the
management functions. In a way, it is a documented report of the activities that
were planned and executed.

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 Management Information System – Catalyst in Decision Making

O B JEC T I VE OF MIS

The objective of an MIS (Management Information System) is to provide information for

decision making on planning, initiating, organizing, and controlling the operations of the
subsystems of the form and to provide a synergetic organization in the process.
The four main objectives for Management Information systems have been defined as:
1. To facilitate the decision making process in the library by providing the
managers with accurate, timely, and selective information that assists them in
determining a specific course of action.
2. To provide for the objective performance measurement and assessment of
selected relevant areas of the library. The areas are to be determined during
strategic planning.
3. To provide pertinent information about the library’s internal and external
environment and,
4. To provide information on alternative strategies and contingency plans.

The benefits of MIS systems to businesses, governments, scientists, universities,

students, nonprofits and all other entities are diversified. Some examples of the most
often realized benefits include the following:
1. Implementation of Management by Objectives (MBO) techniques: MIS allows all
participants, both management and staff, to view, analyze, and interpret useful
data to set goals and objectives.
2. Generates competitive advantages: Businesses succeed or fail based on how
they face competitive challenges. MIS, if implemented properly, provides a
wealth of information to allow management to construct effective plans to meet,
and beat, their competition.
3. Fast reaction to market changes: The victory often goes to the quick, not
necessarily the best. MIS can deliver facts, data and trends to businesses with
lightning speed. Having this information allows companies to react quickly to
market changes, regardless of the type (positive or negative) of volatility.

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 Management Information System – Catalyst in Decision Making

C ASE E XA MPL E - 01

• Study undertaken towards fulfillment of objective of MIS in

Academic Libraries
Management Information Systems are tools designed to improve management
decisions. A changing user population, technology enhancement transformation of
scholarly communication system, digital libraries, new approaches to management,
renewed commitment to planning and assessment, financial constraints, declining
budget, information gluts, constant change in IT ,web services, reader’s expectations
for 24 x 7 services, time shortage etc are compelling MIS to be mandatory in
libraries.

National Knowledge Commission Report (2006-2009) has very clearly mentioned

that Academic libraries play a pivotal role in dissemination of knowledge and are an
extremely important element of the foundation of a knowledge economy. There is
widespread agreement that there is an urgent need for reform in the Libraries and
Information Service (LIS) sector. Several initiatives in this regard have already been
taken by the Government.

In the present day, the MIS based libraries maintain customer (reader) focus as their
central idea during all performances. The objective of an MIS based Library is to be
an effective library through:
(1) Providing convenience and justice to its readers.

(2) Attract non-readers to become readers.

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 Management Information System – Catalyst in Decision Making

Tools for the study

Two scales ‘LAS’ (Library Automation Scale) and ‘LES’ (Library Effectiveness Scale)
were used in the present study. The first scale ‘LAS’ carried fifteen items measuring
the four factors as “Commitment, Infrastructure, Services and Staff Training”. The
second scale, ‘Library Effectiveness Scale’ (LES) was specifically constructed for the
present study. In the present study, Library Effectiveness is measured through
factors of Library Performance, Reader’s Satisfaction, and Staff’s Competence.
‘LES’ carried fifty five items measuring the aforesaid three factors.

MIS in Libraries

The MIS’s function is to provide

library Staff and Readers with
data, information, analysis and
tools that enhance the
effectiveness and efficiency of
library services and assist in the
decision-making process.

The objectives of an MIS are to assist staff with the daily decision making process,
to maintain better accountability and control of resources, to monitor budget
allocations, to improve overall library effectiveness by focusing on outcomes to
generate internal and external reports to improve long-term planning and to facilitate
performance measures activities. Further, the MIS intervention offers utility to
Readers too by means of a wider bibliographic database through e-resources.

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 Management Information System – Catalyst in Decision Making

General Conclusions drawn from the study

The general conclusions drawn and key lessons learned through this study are:

• MIS is possible – but only with dedicated staff resources.

• MIS Enables Executive Support

• Education and Training are Vital

• Openness and Trust must be built for Feedback and Continuous Improvement

• Collaboration between system staff and other stakeholders

• Information Flow

• Skill sets - continuous training on new tools

• Flexibility - Innovation encouraged

• Involve staff at each step

• Planning and Service Standards

• When possible start with a mature integrated system for Synergic Effects.

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 Management Information System – Catalyst in Decision Making

I MPO RT AN CE OF MIS IN D EC I SIO N M A KI NG

The importance of MIS in decision making can
be realized from its aims and objectives. The
aim of MIS is to develop a viable system to
maximize the effective use of modern data
approach to management practices. It is also
aimed at assisting managers and operating
personnel, to produce timely and accurate
information not only to decide present and
future operations, but also to pinpoint potential
problems that need to be rectified.

MIS support decision making in both

structured and unstructured problem
environments.. It supports decision making at all levels of the organization. MIS are
made of people, computers, procedures, databases, interactive query facilities and so
on. They are intended to be evolutionary/adaptive and easy for people to use.

Methods of Decision Making

Methods of decision making

Type of Decision
OLD NEW
Programmed Habit Management Information
Repetitive andStandard operating procedure System
Routine Organization structure, policy etc
Non-Programmed Judgement, Intution, Insight Systematic Approach to
experience problem solving &
Training and Learning Decision making

• MIS is useful in the area of decision making as it can monitor by itself

disturbances in a system, determine a course of action and take action to get the
system in control. It is also relevant in non-programmed decisions as it provides
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 Management Information System – Catalyst in Decision Making

support by supplying information for the search, the analysis, the evaluation and
the choice and implementation process of decision making.

• MIS is useful in making decisions to solve many of the problems facing

educational institutions. Such problems include poor programme scheduling,
poor estimate of staff requirements, lack of accurate information on students,
personnel and facilities, piling-up of administrative matters, wastage of spaces,
lack of feasible budget estimates among others.

• The need for MIS in decision making is stressed as it provides information that is
needed for better decision making on the issues affecting the organization
regarding human and material resources.

• MIS is a technique for making programmed decisions. If we include the computer

and management science as integral parts or tools of computer –based
information systems, the prospects for a revolution in programmed decision
making are very real. Just as a manufacturing process is becoming more and
more automated so is the automation of programmed decisions increasing to
support this production and other information needs throughout the organization.

• Management Information System (MIS) is basically concerned with the process

of collecting, processing, storing and transmitting relevant information to support
the management operations in any organizations. Thus, the success of decision-
making, which is the heart of administrative process, is highly dependent partly
on available information, and partly on the functions that are the components of
the process. For example, if managerial objectives are absent or unclear,
probably due to inadequate information, there is no basis for a search. Without
information obtained through a search, there are no alternatives to compare, and
without a comparison of alternatives the choice of a particular course of action is
unlikely to yield the desired result.

C ASE E XA MPL E - 02

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 Management Information System – Catalyst in Decision Making

• Promise of MIS, as Management

Intelligence System - Hindu Business
Line article dated. 11.11.2010
Collaborative decision-making, which taps
into the knowledge that exists across all
levels in the organisation, works wonders for
root-cause analysis, and hence problem-
solving becomes a regular affair, avers
Poornima Sathy, Head of Mrs. Poornima Sathy Operations, Distil
Information Systems, Chennai.

Following is excerpts from the interview:

• Common problems in today’s MIS:

Businesses’ need to be intelligent is often not met by the archaic MIS

(management information system) in vogue. Management information, which is
often perceived as bulky reports, is a throwback from the days when scores of
people worked on collecting and laying out data to be presented to the
management for decision-making and corrective action.

Irrespective of who consumed the information, or what data are available with the
company in their information systems, the MIS teams stayed back late hours and
weekends in the 1980s and kept pushing out reams of paper filled with tables and
numbers. These folders were often destined to head straight into the dusty filing
cabinets across the company, in most cases the basement.

Computers helped in saving a few trees, the heavy folders became fat attachments
sent through email. However, with the advent of computers and technology, the
only change one saw in this part of the business was that the department churning
out this information came to be called EDP(Electronic
Data Processing) rather than MIS.

• The evolution of MIS over the decades:

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 Management Information System – Catalyst in Decision Making

Millions of rupees of IT systems for information creation such as ERP, finance, and
sales management software have at best automated the entire process of data
collection over time. Information consumption from these sophisticated means is
still in a state that is woefully inadequate.

Here is an outline of the MIS evolution over the decades:

* 1970s - Report only on financial data; MIS manually consolidated and reported;
circulated by post, or hand-delivered; purely post-mortem analysis, and used only
for periodic reviews.

* 1980s - Financial and key business data such as sales/revenue captured;

mainframe systems output into voluminous reports; too detailed to be of any use
for decision-making; past-defines-future approach.

* 1990s - MRP II/ERP systems combined with bespoke financial applications, to

report using spreadsheets; consolidation still a manual job (using computers,
maybe); business analysis still nascent, reporting on financial parameters.

* 2000s - Integrated ERP and business intelligence based systems bring about
combined reporting; output still stuck in the 1980s/90s; detailed business analytics
still a far cry; analytics for decision-making remains a hype.

* 2010 - Age of decision support systems; collaboration and real-time analytics;

advanced analytics for business insight, the necessity.

• MIS headed in the next 5 to 10 years

MIS has transitioned from being an information dissemination function to an

intelligence-generating one. The role of MIS is proactive now.

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 Management Information System – Catalyst in Decision Making

Corporate needs to have the ability to not just tap into their own sources of data for
decision-making, but use the Internet and other unstructured sources of
information to be able to make better and timely decisions. Teams that work and
collaborate in virtual offices spread across the globe need to be able to have
access to the same information in real-time.

Systems and processes have to be able to provide for such needs 24x7. The
ability to quickly predict the outcome, based on sketchy details, is a sure-fire
winner in the present economy. So, collaboration and collective wisdom would be
the key mantra for MIS in the near future.

• To make sense out of mounds of data is where the actual challenge lies for
organisations today; because as has been shown in many cases, what separates
the winners from the laggards is the ability to tailor operations and tactics, based
on the business environment.

The time has come for MIS to grow from churning out the cookie-cutter information
like ageing, ABC analysis, budget versus actual, and so forth. Let the MIS provide
not just the “What” but also the “Why” and the “How”. Allow the data to speak to
you and reveal unknown truths about your specific business.

Example:

A company has a top-rated vendor and procures around 25 per cent of its raw
material from this single supplier who is a private enterprise. This is not only a
control risk but also has a business continuity risk.

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 Management Information System – Catalyst in Decision Making

C ONCLUSION

• The most important features of contemporary MIS systems involve flexibility and
reasonable cost. In the world of business, it matters little what industry you are in,
how large or small the company may be and how computer savvy the
management is. There are MIS systems that are easy to use, affordably priced
and immensely reliable available to all businesses.

• Management Information System to work efficiently and give effective results,

needs to continuously deliver value on three fronts:

a) Keep pace with the trends in the business with a deep understanding of the
nuances.

b) Be in line with the latest that technology has to offer in terms of network
infrastructure, gadgets and devices. The frequency of game-changing
technology is very high: How quickly we have moved from Internet
applications to mobile computing and now the Cloud!

c) Constantly innovate within the space of intelligence and find newer models –
be they about deep analytics, forecasting, predictive approaches, text-based
analytics, and so on.

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 Management Information System – Catalyst in Decision Making

B IBLIOGRAPHY

1. http://www.indianmba.com/Faculty_Column/FC307/fc307.html

2. http://en.wikipedia.org/wiki/Management_information_system

3. http://www.differencebetween.net/language/difference-between-data-and-

information/

4. http://www.ehow.com/about_6174026_objectives-management-information-

systems.html

5. http://www.thehindu.com/business/article880046.ece

6. http://www.futurismtechnologies.com/Information-Management-System-MIS.htm

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