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Introduction

What is MIS:

It is a system consisting of formalised procedures to help

management in performing functions at all the levels .It provides
data based information to the management, from internal and
external resources, which in turn will enable them to make effective
decisions in time for proper planning, directing and monitoring of
ongoing activities. MIS should have its own structured framework of
practices and standards, which should be followed by the
organization in the development, maintenance and use of all the
information systems. MIS is considered and used at many levels of
management, and should support the institution’s long term goals
and objectives.( Lucey,2005)

MIS can be defined as a user and machine integrated system which

provides information to support the operations, management and
strategic functions in an organisation. This system uses computer
hardware and software, procedures, analytical models, decision
making, control and data base. (Davis and Olsen,1985, Collier and
Dixon, 1995).

There are two types of information systems: a. Formal Systems b.

Informal systems. However, formal and informal channels should
always be viewed as complementary to each other, and should not
be made competitors. (Lucey,2005).

Processing the data, and converting it into useful information which

can be effectively communicated to the user is the main essence of
using MIS (Lauden and Lauden,1991).It is based on this useful
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information ,that the management takes important and long term

decisions. Hence the information specialists need to know exactly
what kind of tasks and functions a management performs and
design the system accordingly.

Management, technology and organization elements revolve around the information

systems. (http://emuonline.emu.edu.tr/demo/CSIT421/2002/chp1/chpt1-

1fulltext.htm#wininfo)

MIS managers are the people who are in charge for developing the
information operations for their firm (Kotler et al,2006).This system
development requires 4 stages :
At Phase 1 the system team investigates the initial problem by
identifying it, thereby developing a review study for the
management.
At Phase 2 requirements for the systems is identified which
includes system analysis, user requirements, necessary hardware
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and software. Management at the strategic level then analyse the

systems and review it.
At Phase 3 the system is actually developed, by combining the
support and specifications provided by the technical team and a
review is again taken up using controlled processes, and it is
decided whether or not the system should be implemented.
At Phase 4 system is actually implemented. A new system is
derived by refining the old one. This process must be an ever on-
going maintenance, to evaluate if it still continues to serve the
current business needs. (Ralph, 1996).

Types of Systems:

Management information systems, when used effectively can help

an organisation to gain competitive advantage, the system must
support the organisation to achieve its goals.(Dudman,2006)

Accounting MIS: Accounting managers at all levels share these

accounting reports.

Financial MIS: Similarly, all financial managers within an

organisation must be provided with financial information, along with
the top manager in the department. The chief financial officer then
evaluates the past and ongoing activities and forecasts the future
financial needs, and is also able to monitor and control the available
funds based on the given input by the information system of the
organisation.

Manufacturing MIS: Operations is one functional area, which has

been widely influenced by technology. So much so, that the
manufacturing operations have changed. For example, in many
organisations, inventories are provided just in time to save the huge
amounts of money spent on warehousing huge inventories.
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Marketing MIS: Information at this level helps in important

functions in the marketing department like the development of a
new product to be launched, plans for distributing it in the market,
how to price it, plans to advertise it and predict its success. This
functional area relies heavily upon external data sources like
competitors and customers.

HR Department MIS: This MIS mainly revolves around the

functions concerning all the employees including managers, workers
and others. As people are the driving force of any organisation,
Human resource MIS plays a vital role in ensuring organisation
success. It includes evaluation of the existing employees,
recruitment, selection of the employees and providing them with
specific tasks.

Why MIS?

In today’s world, information systems provide a firm with the

communication and analytical power it needs to carry on with the
business, and sustain in an international market. In this era of
Globalisation, communicating with distributors and suppliers in a
far-flung global corporation, working continuously in new cultures
and still be able to provide the required information across, can
prove to be very challenging for any organisation which requires
very powerful information systems responses.

Moreover, customers now have access to a world wide marketplace

for obtaining price and quality information. Hence, to become a
competitive participant in the international markets, every firm has
to have a sound system to communicate within the firm and also
outside it.
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Management and dissemination of data, is the centre of any

enterprise (Bensau and Earl,1999 ; Jones et al ,2003).However,
some of the theorists (Feeny and Willcocks,1999 ; Jones et al,2003)
have added that only technical skills are not sufficient , a proper
knowledge of business processes and practice are also equally
essential to be able to design , integrate, implement , evaluate and
apply computer-based solutions to business problems. Even though
this is the responsibility of senior management, but it’s the users
whose assistance and feedback helps in its development.

According to the Strategic Development Manager of Tesco Mark

Goddard, it is its Centralised system of Information which is helping
it in creating a set of KPIs, not only in U.K, but also globally. A
continuous review of such a system will prove beneficial in providing
Tesco with a consistent performance that will support it in its
strategy of an ever on-going expansion in new markets.

Tesco is leading the retail market business in Britain, and

considered to be among the top few in the world. It has nearly 2000
stores in 13 countries across Europe and Asia. The business
transformations in Tesco makes one of the most remarkable stories
in the U.K retail industry .Starting from being a comparatively ‘Pile
it high, sell it cheap’ down market retailer, it has now grown to
become one of Europe’s leading retail businesses.
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In U.K, its loyalty card and its e-commerce operations are

considered to be top-most and its expertise in this field is in much
demand (Humby, Hunt and Phillips, 2003, Fernie and Sparks 2004).
Tesco has been in focus of a lot of academic, analyst and
commentator consideration (Burt and Sparks, 2002), and has
become very much dominant in Britain market and is being closely
watched internationally (Burt and Sparks, 2003).

Tesco providing information across various departments

Tesco got the idea of developing a unique Management Information

System , which could support it in the home market as well as the
group reporting requirements.

(Tesco.com/Microlise – Tesco.com/MIS)

The figure above tries to explain the technology behind the functioning of Tesco’s MIS.

Tesco.com, receives data from the Microlise system by a vehicle,

a store group and a driver which comprise of information relating
vehicle location, contextual speed, driving style and the schedule
adherence. They are updated every minute and the MIS sends
reports to over 320 stores instantly.
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In 2003, Tesco announced “Tesco in a Box” concept, which

according to Mike Yorweth, technology and architecture director
of Tesco is a set of IT systems covering all the building blocks of
Tesco. It aims to cover everything from the planning and setting
up of stores to strategic decisions like targeting new markets,
deciding upon the products to be launched and obtain those
products into markets from the suppliers, to the selling of the
products in local market.(http://search.computerworlduk.com/tag/tesco-
information-systems-strategy) , it covers all the important
departments like the information management, people
management and IT management. In short, it is an end-to end
system. Tesco planned to introduce this system in 4 countries
every year, and the company is using the system globally now.In
2007, Tesco extended its in-house design through Micro focus,
and reformed its supply chain application based on main-frame
and then transferred it on Unix servers.

Levels of Management:
In nearly all the organisations, three levels of management are
clearly visible:
1. Top or Strategic Management
2. Middle or Tactical Management
3. Junior or Operational Management
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The above figure explains the different information systems involved at the 3 tiers of
management.

It is very important to understand that the role played by different

managers differ at the various stages of organisation. At the
strategic level, decisions about products and services to be
produced are taken and the decisions taken at this level affect the
organization tremendously as these decisions are not easily
reversible and are long-term.

Tesco using MIS at the Strategic Level:

Tesco is able to maintain a competitive edge through an excellent

information systems. This would help it to exercise its sophisticated
MIS and implement it in all the global operations. Tesco’s MIS is
helping it to gain an insight into business performance, and
providing a chance to predict and improve new operations across
the world.

Based on the information collected, stored and organised at the

tactical level Tesco is able to take its strategic decisions. Hence,
Tesco has invested heavily in IT over the years, in an attempt to
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improve its information systems including sales, the supply chain

and efficiency across the company. The company has developed an
in-house designed supply chain application, which runs on the IBM
system p servers based on Unix. Over the time, the company has
made noticeable improvement in its stock management. It has
implemented more efficient ordering systems, and monitoring
processes. Also, in an attempt to increase the customer service in
all the countries it has invested in self-service checkouts, and also
announced the launch of an application for the iphone, which will
allow the customer to store their club card, loyalty card on their
phone and swipe it in place of actual card.

By maintaining a powerful information system, it was able to

successfully implement its online business and achieved a 14
percent increase in sales and a 26 percent increase in its profit.

MIS at Middle or Tactical level:

At the middle level or the tactical level, middle managers execute

the programs and plans, which are taken up to the strategic level.
Decisions at this level are also important and affect the working of
the organization.

Tesco MIS at tactical level:

At the tactical level, middle-managers have to perform and organise

various functions such as payroll, store planning support, help desk
activities, customer service management and driving the online
traffic to the Tesco.com website in an efficient manner, using online
search tools, networks and other online media sites. The team also
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has to manage and continuously review business reports across the

various retail stores.

At this level, information of all the payrolls for employees in the

U.K, is maintained to be retrieved whenever required. Also, the
information collected from all the departments including finance
department, HR department and sales department is reviewed and
used for further planning and forecasting.

The information stored and maintained at this level is utilised at the

strategic level in order to take major strategic decisions, which will
have long-term affect on the organisation.
Hence, the information at the tactical level requires handling of
extensive resources and careful designing of in-house processes,
which in turn will ensure tracking of performance, errors and any
issues across the retail process functions.

Tesco.com, known to be the online arm of Tesco, has developed a

loyal following due to its commitment to excellence in home grocery
delivery service. Due to the huge success and expansion, Tesco had
to open a store designed solely for fulfilling online orders, to serve
the whole of South London. With the dense population and
complexity of London, Tesco felt the need of a navigational device
to ensure drivers found the most efficient delivery routes to provide
excellent customer service.

Hence, Tesco worked with Microsoft and it’s partner ALK to develop
a powerful satellite navigational system which could integrate with
their existing scheduling solution.

The organization element is the anchor between the sales and

production department and the trackable packaging system. This
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system helps both the receiver and sender to identify the packages,
and also to the customer service representatives. This system also
helps the managers and employees to have access to the
information needed. The drivers are then provided with the required
training for the delivery and tracking, so that they can work
efficiently and effectively. Customers also need to be updated as to
how to use the in-house packaging software or the Tesco.com web
site. The management which monitors the level of service being
provided, and checks the costs of the products, in turn help the
company by providing ideas to provide a low- cost service, which is
of a standard quality. With the help of UPS package and delivery
system, the company is able to reduce the costs involved. This
resulted in helping it maintain the strategy of selling products at
affordable prices, even in the tough competition it faces.

MIS at the operational Level:

At the operational level, the managers will have to monitor the

company’s routine activities and report them to the tactical level.
Their decisions are mostly concerned with the day-to –day activities
and do not affect the organization in the long run.
But it is to be understood that all managers at every level have to
be innovative and initiate solutions which should cater to the
problems faced by the company at various functional levels.

Tesco MIS at operational Level:

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In Tesco it is the technology involved which is helping it to perform

all the operations including small factors like the queuing, or
billing, so as to provide the customers a satisfactory
experience. Tesco is able to recognise the changing trend in its
business environment and acting accordingly. Their system
continuously develop and maintain unique and creative
applications and now Tesco has come up with a new working
model that is used by its various business processes and
information departments to meet the business needs inspite of
its expanded market, employees are able to have regular
updates from all the key areas. Detailed information is
available on items and users are able to attain comparisons.
Tesco is also now able to improve its marketing with
improvised tracking and reporting systems.

Tesco has come out with the following projects to improve its
Information system management:

The Club card Process: The club card is a system that allows
customers to accumulate loyalty points on each shopping and save
them for future use. This project was designed, keeping in view
customer’s convenience. Now the customers can continue receiving
their vouchers even after they change their address. However,
there was an issue, as the points that were not properly deducted
and led to losses. The issue was recognised and addressed and
corrected by updating the systems with current customer
information.

Integration with Supplier’s System: Tesco came out with an

integrated IT system, which helped to facilitate the interaction with
retail suppliers .This system enables the supplies to be delivered
directly at stores by the suppliers, through Tesco warehouse. By
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adopting this system Tesco is able to achieve an improvised stock

control , impletion and a more efficient handling of returns.

Smart Voucher Project: By developing this smart voucher

solution, Tesco is now able to redeem the vouchers which are
effective in real-time. The vouchers are now combined with a
unique number which helps in checking fraud and ensures reward
related problems to be resolved efficiently.

Paperless picking: Employees can now use a device which is tied

to their wrists, while entering the distribution centres and swipe it
at the warehouse entrance. After doing this, each employee is
assigned with a list of tasks to be performed on the selected
products, and all related information about the concerned products
is also provided, and helps in the delivery process.

This management Information System at Tesco provides updated

information to the store managers on the available stock in each
store. Real- time and detailed reports are also submitted.

In particular, Planning, decision making and control are the three

crucial areas in any organisation, which demands accurate and high
level of information system. These are the basic tasks required at
every level of management and hence referred as the primary
management tasks. In order to provide the needed degree of
accuracy in the information provided, the MIS specialists have to be
informed about the ‘programmed’ and ‘non-programmed’ areas of
decision making (Hall and Abell, 2006).Programmed decisions are
the ones where, decision rules are predictable due to their repetitive
nature. Whereas , in non-programmed areas, the decision rules are
complex and difficult to understand. Since different decision making
require different procedures, hence there will be different
implications on the designing of MIS.
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Therefore, all businesses irrespective of their size are using

information systems, internet technology and various network
systems to develop their business electronically.

Critical analysis of Tesco’s MIS

• An efficient MIS enables an organisation to provide answers to

various managerial levels by collecting the basic data from the
operations department and combine it with the information
collected from the employees in the expert systems, and
reflect it in the company’s procedures .Tesco is continuously
striving to provide highly sophisticated technology and
investing hugely in the same and has been successful in
maintaining one of the best data bases. Business Objects
Enterprise 6 and Teradata warehouses are providing Tesco
with a centralised information system that provides it with a
sophisticated business insight into its technical operations.

• As an organisation expands, MIS must allow the information

to be easily accessible to various departments and functional
areas. Thereby, minimising the requirement of direct
interaction, and thus result in increased responsiveness by the
firm. Tesco is operating 2000 stores in 13 countries, and is
efficiently managing and transferring the required data to
various functional managements in a timely manner, across
the globe. Its success speaks for its excellent information
systems.

• Tesco introduced Group MIS in Turkey, and implemented the

same in Poland during 2005, and plans to repeat the same
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with the help of a group MIS, that should be bale to address

the key areas of operations, finance and people.
.

• A well organised and well constructed MIS provides the

management with the information needed to help it reduce its
operating costs and increase profits. Tesco is proving this by
maintaining a dominant position in U.K retail market and by
being counted amongst top 3 international retailers. It has
cut down its operating costs efficiently by introducing Tesco
direct and Tesco.com, and has sustained recession with
considerable increase in profits over years.

• However, Tesco is investing hugely in its technology and

advanced technological systems can prove to be expensive if
the financial head doesn’t know where and how to control the
system purchases needed by various departments right from
the beginning.

• Also all organisations have similar technologies or will be able

to acquire them soon, so the real challenge is to retain the
information assets which are exclusive to Tesco. Even though
information resources can be acquired , utilized and
manipulated ,the continuous development of information
assets is very significant.(Desouza,2009)

• Tesco has to take care that its MIS does not become an
inflexible system over the time. Making quick changes to its
complicated MIS in times of fluctuating business operations
might become a challenge for Tesco, depending on the style
and functionality of its MIS. Even though carrying out internal
processes like policy revisions for internal control and
operations might be easy but major changes like marketing
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strategy, product development or service changes will not be

easy.If it has to undertake major business changes, then its
MIS will also have to undergo sudden changes, which will lead
to high costs and downtime of information reporting.

• When a company is small in size , it is easier for them to be in

direct contact with each other and employees are often able
to share knowledge directly, whereas as the number of
employees increase the difficulty in maintaining teams and
functional areas increases( Kroenke,2008). Tesco is a huge
organisation, hence it is more difficult for them to maintain
the flow of data and ideas across the organisation.

Conclusion

In today’s world of globalisation, and information, managing

information is one of the key strategic issues for management.
By managing information, it can increase organisational
effectiveness and optimize achievement of business goals and
objectives. Tesco has successfully implemented its information
systems through out the organisation, and is using information
effectively across all its departments. Inspite of having a
complicated and huge infrastructure, Tesco is regularly updating
its systems, and utilising it to manage business processes,
efficiently. But it has to keep improving and make itself ready for
new challenges, and continue to grow.

Recommendations

Tesco has deployed a sophisticated MIS , and is maintaining it

well, however it should ensure that it is flexible in order to cope
up with sudden and unpredictable changes in the Business
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processes, as this can be a challenge even for the best

information systems. Security of the stored and used information
is an issue of concern, hence all possible security measures have
to be revised from time to time. As just knowing that change is
inevitable is different from accepting it and taking right actions at
the right time.(Penfold, 2000)

As is the case with all major organisations, Tesco also has to

concentrate on its external environment and keep a close watch
on its competitors. Hence, it needs to work towards the informal
systems and develop its resources. As information systems
extend beyond the firm’s boundaries and has to include vendors,
customers and even competitors (Laudon and Laudon 2004).

Because of its huge size, the amount of data accumulated can

cause an over flow. Therefore, it has to keep a continuous check
on the information flow to avoid an impaired communication
across the various functional departments, which could seriously
affect its information systems slowly and gradually in the long
run.

It has to ensure the compatibility of the systems by adopting the

right set of applications are used throughout the organisation,
this will make the creation of sophisticated databases cost-
effective and easier. This should eventually result in inclusion of
programs that collect procedural and other knowledge deposited
by the employees.
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