National Institute of Business Management

Chennai - 020

SECOND SEMESTER EMBA/MBA

Subject : Management information System

Attend any 4 questions. Each question carries 25 marks

(Each answer should be of minimum 2 pages / of 300 words)

1. Why MIS is an excellent tool to provide management information at all stages

of decision-making, thus, greatly helping an organisation to achieve its set of
goals and objectives? Explain.
The MIS is an idea which is associated with man, machine, marketing and
methods for collecting information’s from the internal and external source and
processing this information for the purpose of facilitating the process of
decision-making of the business.

MIS is not new, only the computerization is new , before computers MIS
techniques existed to supply managers with the information that would permit
them to plan and control business operations. The computer has added on
more dimensions such as speed, accuracy and increased volume of data that
permit the consideration of more alternatives in decision-making process.

The scope and purpose of MIS is better understood if each part of them is
defined individually, thus

1. MANAGEMENT: Management has been define in process or activities

that describe what managers do in the operation for their organization plan,
organize, initiate and control operations. They plan by setting strategies and
goals and selecting the best course of action to achieve the goals. They
organize the necessary tasks for the operational plan, set these tasks up into
homogenous groups and assign authority delegation; they control the
performance standards and avoiding deviation from standard.
The decision-making is a fundamental prerequisite of each of the foregoing
process, the job of MIS is facilitating decisions necessary for planning,
organizing and controlling the work and functions of the business so that
specified goals of business are achieved.

2. INFORMATION: Data must be distinguished from information and the

distinction is clear and important for present purpose. Data are facts and
figures that are not currently being used in a decision-making process and
usually are taken from the historical records that are recorded and filled
without immediate intent to retrieve for decision-making.

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

used for information or interference purpose, argument or as a basis
forecasting or decision-making regarding any business unit. Information is
knowledge that one derives from facts for effective functioning of systems
placed in the right context with the purpose of reducing uncertainty regarding
the alternative courses of action as they are based on description and
measurement of attributes of various entities associated with the enterprise.

3. SYSTEM: The system can be described as a set of elements joined

together for a common objective. A subsystem is a part of a larger system with
which one is concerned. All systems for our purpose the organization is the
system and the parts (divisions, departments, functions, unit etc) are the
subsystem.
The system concept of MIS is, therefore one of optimizing the output of the
organization by connecting the operating subsystems through the medium of
information exchange.

The Management information system (MIS) is a concept of the last two

decade or two. It has been understood and described in a number of ways. It is
also known as the Information System, the Information and Decision System,
the computer based Decision System.

Information is the life blood of an organization, particularly in the case of

system approach management. The MIS or Information system can be define
as the knowledge communicated by others or obtained from investigation or
study. It is a system providing needed information to each manager at the right
time in the right form and relevant one which aids understanding and
stimulates the action. MIS is an organized method of providing past, present
and projection information relating to internal operations and externals
intelligence. It supports the planning, control and operational functions of an
organization by furnishing uniform information in proper time frame to help
the process of decision-making.

Management Information System is generally defined as an integrated user-

machine system for providing information to support operations, management
and decision-making functions in an organization. The system utilizes
computer hardware and software, manual procedure, models for analysis.
Information is viewed as a resource much like land, labor and capital. It must
be obtained processed, stored, manipulated and analyzed, distributed etc. An
organization with a well-defined information system will generally have a
competitive advantage over organization with poor MIS and no MIS.

The MIS has more than one definition, some of which are given below:

I. The MIS is defined as a system which provides information

support for decision-making in the organization.
 II. The MIS is defined as an integrated system of man and machine
for providing the information to support the operations, the management and
the decision-making function in the organization.

III. The MIS is defined as a system based on the database of the

organization evolved for the purpose of providing information to the people in
the organization.

IV. The MIS is defined as a computer-based information system.

Though there are a number of definitions all of them converge on a single

point, i.e. the MIS is a system that support the decision-making function of the
organization. The difference lies in defining the elements of MIS. However, in
today’s world, the MIS is a computerized business processing system
generating information for the people in the organization to meet the
information needs for decision-making to achieve the corporate objective of
the organization.

MIS is a computer-based system that provides flexible and speedy access to

accurate data. The organizational information system which in general relates
to the planning, operation and control of an enterprise are the most important
among them. MIS refers primarily to such an organizational system which is
generally large, sophisticated, structured and dynamically evolving and of
immense commercial values. A large number of programmers and system
analysts are employed by many organizations to build a variety of MIS. Thus,
the education of programmers and system analysts as well as general manager,
the subject of MIS, has occupied a key position.

Thus, MIS is a set of computer-based system and procedures implemented to

help managers in their routine job of decision-making and planning, expansion
and development.

The objective of MIS is to provide information for a decision support process

of management. It should help in such a way that the business goals are
achieved in the most efficient manner. Since the decision-making is not
restricted to a particular level, the MIS is expected to support all the levels of
the management in conducting the business operations. Unless the MIS
becomes a management aid, it is not useful to the organization.
Modern management system relies on MIS, the complexity of business
management and competitive nature of business requires handling of business
operations with skill and foresight to advert the crisis. The management
process is executed through a variety of decisions taken at each step of
planning, organizing, staffing, directing, coordinating and controlling. If the
management is able to spell out the decision required to be taken, then the
MIS is designed suitably.

The actual MIS process relates to:

A. Collection

B. Organization

C. Distribution

D. Storage of wide information

E. Managerial control and analysis of data

Hence MIS focuses on:

i. Organization-wide information

ii. Decision-making process

iii. Managerial control and analysis

iv. Computer-based system

CONCLUSION: Management Information Systems is sets of inter-related

procedures using information system infrastructure in a business enterprise to
 generate and disseminate the desired information. Such systems are designed
to support decision-making by the people associated with the enterprise in the
process of attainment of its objectives. The MIS gets data and other resources
of IT infrastructure as inputs from the environment and process them to satisfy
the information needs of different entities associated with the business
enterprise. There are subsystems of control over the use of IT resources and
feedback system offers useful clues for increasing the benefits of information
system to business. The MIS are subsystem of business system and by
themselves serve the function of feedback and control in business system

2. Discuss the models used for MIS development.

3. Explain the role of MIS in an organisation for planning and decision making.
Simply MIS stand For Management Information System. For Simply
Understanding Management Information System (MIS) we can divide in to
three Word and Understand Part by part
1.Management: - “Management is function to do the work at the Right time,
by the right Person, For the Right Job.”
2.Information: - “Information is the Collection of Organized data which plays
a Vital Role for decision making.”
3.System:-“System Consist for a set of elements which Provides a Framework
to convert Unorganized (Data) into Organized Information.”

Meaning of Management Information System

Management information system refers to such system which provides

accurate information to the entire level of management for decision making
process. For right job at the right time, by the right person.

Management information system

Management information System

Role of Management Information System

 Management information system (MIS) has become Very Necessary due to
Emergence of high complexity in Business Organization. It is all to know that
without information no Organization can take even one step properly
regarding the decision making process. Because it is matter of fact that in an
organization decision plays an essential role for the achievement of its
objectives and we know that every decision is based upon information. If
gathered information are irrelevant than decision will also incorrect and
Organization may face big loss & lots of Difficulties in Surviving as well.

•Helps in Decision making: - Management Information System (MIS) plays a

significant Role in Decision making Process of any Organization. Because in
Any organization decision is made on the basis of relevant Information and
relevant information can only be Retrieving from the MSI.
•Helps in Coordination among the Department: - Management information
System is also help in establishing a sound Relationship among the every
persons of department to department through proper exchanging of
Information’s.
•Helps in Finding out Problems: - As we know that MIS provides relevant
information about the every aspect of activities. Hence, If any mistake is made
by the management then Management Information Systems (MIS) Information
helps in Finding out the Solution of that Problem.
•Helps in Comparison of Business Performance: - MIS store all Past Data and
information in its Database. That why management information system is very
useful to compare Business organization Performance. With the help of
Management information system (MIS) Organization can analyze his
Performance means whatever they do last year or Previous Years and whatever
business performance in this year and also measures organization
Development and Growth.

4. Describe the methods used in implementing MIS.

Implementation of a system is as much important as the creation of it.
Implementation can easily destroy the good work done in the earlier phases
and bring the system to a standstill. Implementation requires technical and
managerial skills as the implementers work as change agents. Implementation
is also a process that has a series of sequential steps which culminates in
making operational the new system.

Implementation as an activity has to be carefully managed. It requires client

interaction at every stage. The implementers need the full support and
cooperation of the client and the IS department functionaries to successfully
execute the implementation of information systems. In order to help them
perform this task of implementation smoothly, a series of predefined steps are
followed. These implementation tasks are as follows:

Implementation Plan

It is the series of action-oriented steps planned for making the implementation

smooth. It normally involves the following steps:
1.Creating a master schedule of the implementation activities
2.Setting timelines for critical and non-critical activities
3.Identifying major bottlenecks and their solutions
4.Communication of the plan.

This step is required to help the user community to understand the time frame
for installation of the new system. Communication plays a vital role in the
implementation and without proper communication especially, from the top
management on the installation and implementation of the new system the
change management will be difficult. Resistance to change related issues will
come to the fore making the difficult task of implementation more difficult.
Communication of the plan of implementation to the user community helps
the users to prepare for the change and makes them mentally prepared for it.
The communication is required to be formal so that rumors cannot be spread
about the system. The communication process may itself be in several phases.
The top level can communicate the general intent of the new system and then
detailed briefings to staff may be left to the divisional heads. The
communication process also indicates (indirectly), the role each employee is
required to play in the implementation process.

Organizing the MIS Department

The MIS department will be the custodian of the new system. Hence, they
have to be gear up to support the new system. Organization of the department
is therefore necessary before the new system becomes operational. The roles
of each member of the MIS department have to be clearly laid out before the
new system becomes operational. Effort is made to ensure that the role of the
MIS staff is understood by each member of the organization. Training is
provided to those who need training on the new system so that they in turn can
help others. This process of organizing the MIS department starts much before
the actual implementation process begins as it entails some hiring and training
which requires some lead time. The organization is done in such a timeframe
that staff is available when the actual implementation starts. This enables the
MIS staff to provide support to the implementation team, when the
implementation process starts. This will also help the MIS staff to understand
the nitty-gritty of the new system as they will be able to get a hands-on
experience in the implementation of the new system.

Selection and Procurement of Hardware

This step of the implementation process is an important step as it involves

huge investments. Proper care is taken to ensure that the organization gets the
best deal from such selection and procurement of the hardware. The process of
selection and procurement of hardware also varies greatly from firm to firm
depending on the size of the firm and the sector in which it operates the type
of management. However, the following procedure is followed:
1.Preparation of vendor list-a list of reliable vendors is prepared. This list of
vendors may be prepared after analyzing the vendor management experience
of the organization with different vendors or may be prepared based on some
accepted list of vendors in that business space prepared by some organization
of repute or some industry body/regulatory body. The vendors that are selected
to be part of the list are chosen carefully after a thorough checking of their
credentials and goodwill in the market. This is essential as the vendor
relationship is based on trust and compromise and not only on the basis of
strict commercial terms.
2.Preparation of RFP-the implementation team must prepare the request for
proposal document based on their understanding of the hardware requirement
of the new system. The RFP must have complete technical details about the
required hardware systems including specifications, format, performance
expectation, and warranty and service quality requirements. This document is
prepared by the implementers in consultation with the development team,
management of the organization and the MIS team of the organization so that
the need for each specification is well established and there is no scope for any
difference of opinion. The consultative process results in the RFP which is a
technical document. The RFP also has commercial details which the
implementation team prepares in consultation with the management of the
organization. The RFP is a quasi-legal document in some countries and proper
legal opinion is normally sought before sending it to the enlisted vendors.
3.Request for bids/proposal to select vendors-after the RFP is prepared it is
sent by some mode of communication to the enlisted set of vendors. The
communication medium can be an open advertisement in print or electronic
media or may be in the form of a letter to the vendors with a deadline for
submission of the proposal.
4.Evaluation of RFP-this is a difficult process. After bids are received before
the deadline, they are checked (preliminary check) for basic errors. Those
found to be prima facie proper are then evaluated. Several methods of
evaluation exist. The evaluation could be on the basis of cost alone or quality
alone or may be a mix of both cost and quality. Typically, a score based system
of evaluation is used to rank the vendors' proposals. Scores are assigned to
each attribute of a vendor's proposal like cost, goodwill, track record and
service quality guarantee. Based on the weight age given to each attribute a
composite score is prepared, which is used to evaluate the proposals. Whatever
tJ1emethodology for evaluating the proposal, one must take care to apply the
same evaluation criteria to all proposals. Different yardsticks should not be
applied to different proposals.
5.Selection of vendor-based on the evaluation a single vendor or a select set of
vendors are chosen for delivery of hardware. Contract negotiations and price
negotiations are held with this select group of vendors and following the
successful completion of the negotiations the final contract will be signed.

Procurement of Software

The new system being implemented will have been created based on
assumptions of operating environment of the organization. Procurement of
system software is done on similar lines as the procurement of hardware. The
only difference in the case of procurement of software is that the choice of
what software to purchase is already made at the design stage of the system
development and hence, the RFP preparation process is straightforward. The
implementation team need not prepare the specification for the system
software. They only need to procure the system software that the new system
is designed to run on. The rest of the process is almost similar to the hardware
procurement process.

Creating the Database

The new system to be implemented will have data stores. In modern systems,
data stores are databases. These databases are relational database management
systems, which is a separate application software package. The database has to
be created and structures inside the database have to be created in order to
enable it to store data. The implementation team creates the database, its
structures and rules so that the application system being implemented can be
plugged into the database and start working.

Training of Users
 Implementation is a larger issue than installation. The new system may get
installed but without proper training of users, it may not be of good use.
Implementation is a larger concept and focuses on the installation and hand-
holding part of the transition process. A training needs assessment is done to
understand the training needs of the users. A training programme is planned
and the required training given to users. This is an important part of the
implementation process and helps in reducing the resistance to change related
behavior among the user community. The training also helps users to
appreciate the new features of the new system and helps build trust and
appreciation for the new system.

Creating Physical Infrastructure

The new system being implemented may require a physical infrastructure. The
implementation team must ensure that the system performance must not suffer
due to infrastructure bottlenecks. The implementers will have to use their
persuasive skills and convince the management of the organization to create
the required physical infrastructure so that it does not affect the performance
of the new system.

Transition to the New System

This is the last step in the implementation process. The transition if done
wrongly leads to a lot of pain. Hence, it is necessary to move slowly on the
transition front. Normally, after the new system is installed and ready, the new
system and the old system are both used for a period to ensure that the
company performance does not suffer due to transition problems. Slowly
when the users gain more capability to handle the new system the old system
is phased out.

5. Explain the essential characteristics of decision Support System(DSS).

Decision Support System are interactive information systems that depend on
a (having different things working together as one unit) set of user-friendly
hardware and software tools to produce and present information that is
targeted to support the management in the decision-making process. The
decision support systems help management decision-making by combining
data, fancy (or smart) (related to careful studying or deep thinking) models
and user-friendly software into a single powerful system that can support
semi-structured or (without rules, schedules, etc.) decision-making. The
decision support system is under user control, from early beginning to final
putting into use and daily use. Decision support system helps to close the
information gap to enable managers to improve quality of their decisions.
While MIS is carefully thought believed useful for structured decisions, DSS
is carefully thought about to be more useful for decisions at the
strategical/strategic levels, where decision-makers are often angrily stood up
to with complex decisions which are beyond their human abilities to
(creation/combination)e properly the factors involved. DSS refers to a class of
systems, which support in the process of decision-making and does not always
give a decision itself. These systems can be used to validate decision by
performing sensitivity analysis on different guidelines of the problem. read
more about information technology and human resources meaning

While developing decision Support System, the focus must be on identifying a

problem and a set of capabilities that users consider useful in arriving at
decisions about that problem. While developing DSS, therefore, care must be
taken to make sure that the Decision Support Systems possess the following
desirable characteristics:

1. Should aid the decision-maker in decision-making.

2. Should be able to address semi/un-structured decision-making situations.
3. Should support decision-makers particularly at tactical/strategic levels.
4. Should be able to create general-purpose models, simulation capabilities
and other analytical tools available to decision-maker.
5. Should enable users to use DSS without assistance from MIS/technical
professionals.
6. Should be readily adapted to meet information requirement for any
decision environment.
7. Should provide mechanism to enable rapid response to a decision-maker’s
request for information. 8. Should have the capability to interface with
corporate database.
9. Should be flexible to accommodate variety of management styles.
10. Should facilitate communication between/among various levels of
decision-making.
11 Should have in-built flexibility and ability to evolve as user-sophistication
grows.
12 Using of interactive methods are better advised.
Components of Decision Support System

1. Dialogue management: It has three subsystems. The user interface

subsystem manages the physical user interface. It controls the appearance of
the screen, accepts input from the user and displays the results. It also checks
the user commands for correct syntax. The dialogue control subsystem
maintains a processing context with the user. The request translator is to
translate the user command into actions for the model management or data
management components into a format understandable by the user. Since
flexibility and ease of use are important in DSS, GUIs are becoming the
standard for DSS applications. Database is normally through SQL.

2. Model management: The command processor receives the commands from

the dialogue management components and delivers those commands from the
dialogue management components to either the model base management
system or the mode execution system.

3. Database management: It stores and manipulates the database as directed by

either the model management component or the dialogue management
component. Secondly, it maintains an interface with data sources that are
external to the DSS, viz., TPS database, inter-enterprise systems, external data
utilities and other DSS applications.

Types of Decision Support system

1. Status inquiry systems: The number of decisions in the operational

management and some at the middle management are such that they are based
on one or two aspect of decision-making situations. It does not call for any
elaborate computation, analysis, choice. If the status is known the decision is
automatic.

2. Data analysis system: Decision systems are based on comparative analysis

and make use of formula or an algorithm. These processes are not structured.
The use of simple data processing tools and business rules are required to
develop this system. Examples include personnel inventory system, cash flow
analysis, etc.

3. Information analysis system: Data is analysed and the information reports

are generated. Reports can have exceptions. These reports are used for
 assessment of situation. Examples include sales analysis, accounts receivable,
etc.

4. Accounting system: These systems are not necessarily required for decision-
making, but they are desirable to keep track of the major aspects of the
business or a function. These system account items such as cash, inventory,
personnel and relate it to a norm or norms developed by the management for
control and decision.

5. Model-based system: These systems are simulation models or optimization

models for decision-making. These decisions, generally are one time and
infrequent and provide general guidelines for operation or management.
Examples include product mix, job scheduling rules, etc.

6. Explain the constituents of information needs in the context of marketing.

25 x 4=100 marks