Management information system (MIS) provides information that organizations require to manage themselves efficiently and effectively. Management information systems are typically computer systems used for managing the organizations. Management information systems are distinct from other information systems because they are used to analyze and facilitate strategic and operational activities.
Role of Management Information Systems in an Organization
The role of the MIS in an organization can be compared to the role of heart in the body. The information is the blood and MIS is the heart. In the body the heart plays the role of supplying pure blood to all the elements of the body including the brain. The heart works faster and supplies more blood when needed. It regulates and controls the incoming impure blood, processes it and sends it to the destination in the quantity needed. It fulfills the needs of blood supply to human body in normal course and also in crisis.
MIS plays exactly the same role in the organization. The system ensures that an appropriate data is collected from the various sources, processed, and sent further to all the needy destinations. The system is expected to fulfill the information needs of an individual, a group of individuals, the management functionaries, the managers and the top management. MIS satisfies the diverse needs through a variety of systems such as Query Systems, Analysis Systems, Modeling Systems and Decision Support Systems, MIS helps in Strategic Planning, Management Control, Operational Control and Transaction Processing.
MIS helps the clerical personnel in the transaction processing and answers their queries on the data pertaining to the transaction, the status of a particular record and references on a variety of documents. MIS helps the junior management personnel by providing the operational data for planning, scheduling and control, and helps them further in decision making at the operations level to correct an out of control situation.
MIS helps the middle management in short them planning, target setting and controlling the business functions. It is supported by the use of the management tools of planning and control. MIS helps the top management in goal setting, strategic planning and evolving the business plans and their implementation. MIS plays the role of information generation, communication, problem identification and helps in the process of decision making. MIS, therefore, plays a vital role in the management, administration and operations of an organization.
Impact of Management Information Systems in an Organization
Since the MIS plays a very important role in the organization, it creates an impact on the organization’s functions, performance and productivity. With good support, the management of marketing, finance, production and personnel become more efficient. The tracking and monitoring of the functional targets becomes easy. The functional, managers are informed about the progress, achievements and shortfalls in the probable trends in the various aspects of business. This helps in forecasting and long term perspective planning. The manager’s attention is brought to a situation which is exceptional in nature, inducing him to take an action or a decision in the matter. A disciplined information reporting system creates a structured data and a knowledge base for all the people in the organization. The information is available in such a form that it can be used straight away or by blending analysis, saving the manager’s valuable time.
MIS creates another impact in the organization which relates to the understanding of the business itself. MIS begins with the definition of a data entity and its attributes. It uses a dictionary of data, entity and attributes, respectively, designed for information generation in the organization. Since all the information system use the dictionary, there is common understanding of terms and terminology in the organization bringing clarity in the communication and a similar understanding throughout the organization. MIS calls for a systematization of the business operation for an effective system design.
A well designed system with focus on the manger makes an impact on the managerial efficiency. The fund of information motivates an enlightened manger to use a variety of tools of management. It helps him to resort to such exercises as experimentation and modeling. The use of computers enables him to use the tools techniques which are impossible to use manually.
Since the MIS works on the basic systems such as transaction processing and databases, the drudgery of the clerical work is transferred to the computerized system, relieving the human mind for better work. It is observed that a lot of manpower is engaged in this activity in the organization. The study of the individual’s time utilization and its application has revealed that seventy percent of the time is spent in recording, searching, processing and communication. This is a large overhead in the organization. MIS has a direct impact on this overhead. It creates an information based work culture in the organization.