MANAGEMENT INFORMATION SYSTEMS

A Management Information System (MIS) converts data from internal and external sources into information. This information is communicated in an appropriate form to managers at different levels in a business to enable them to make effective decisions for:

• planning,
• directing,
• forecasting,
• coordinating,
• controlling

activities for which they are responsible.

A MIS uses a database system relying on data from one or more databases. The data is usually held in the computer as a result of normal data processing activities.

The information provided by the MIS should be:

• reliable,
• consistent,
• appropriate to the level of management,
• accurate,
• timely,
• precise - provided at a suitable level of detail,
• clearly understandable,
• regular.

It is likely to fall into the following categories:

• financial information,
• operational information,
• marketing information.

The information provided can fall into three main types:

1. strategic,
2. tactical,
3. operational.

STRATEGIC INFORMATION

Used by:

• senior managers, eg. directors and chief executives in a business,
• head teacher and governors in a school or college,
• directors of a charity,
• hospital administrators.

Used to:

• allow long-term planning,
• provide an over-view of the operation of the whole organisation, so that an assessment can be made of how well objectives have been met,
• compare costs and profits with forecasts.

Information at this level can be varied in both content and timing; external data sources will be important.

TACTICAL INFORMATION

Used by:

• middle managers, department heads,
• regional managers,
• functional managers.

Used to:

• monitor performance,
• make forecasts,
• controlling the business.

Information usually prepared on a routine basis, weekly or monthly

OPERATIONAL INFORMATION

Used by:

• operational managers,
• supervisors,
• branch managers.

Used for:

• organising staffing rotas,
• monitor sales,
• assessing when and what to re-order.

Information is usually very detailed and provided regularly and often, eg. daily.

ADVANTAGES OF MANAGEMENT INFORMATION SYSTEMS

Use of MIS leads to;

1. improvements in price/performance ratios,
2. a more relevant service for customers,
3. a better quality service for customers,
4. bigger profits for MIS users,
5. more accurate sales data,
6. better marketing information,
7. better trend-information on profits.

DISADVANTAGES OF MANAGEMENT INFORMATION SYSTEMS

MIS can suffer from these problems;

1. lack of terminals for staff to use,
2. insufficient storage for the volume of data,
3. lack of operational support,
4. training issues,
5. maintenance issues,
6. bottlenecks in interfacing between the data and the user,
7. staff ignorance of the capabilities of the MIS,
8. inadequate security,
9. inadequate expansion capability.