Last Updated on7 min read
What is MIS?
MIS is an organized integration of hardware and software technologies, data, processes, and human elements. It is a software system that focuses on the management of information technology to provide efficient and effective strategic decision making.
A Management Information System is
- An integrated user-machine system
- For providing information
- To support the operations, management, analysis, and decision-making functions
- In an organization
The system utilizes
- Computer hardware & software
- Manual procedures
- Models for analysis, planning, control, and decision making, and
- A database
Table of Contents
- 1 What is MIS?
- 2 MIS Definition
- 3 MIS Meaning
- 4 Components of MIS
- 5 Objectives of MIS
- 6 Characteristics of MIS
- 7 Advantage of MIS
- 8 Role of MIS
- 9 Challenges of MIS
- 10 Limitations of MIS
- 11 Summary
MIS Meaning: A management information system is an acronym of three words, viz., Management, information, system. In order to fully understand the term MIS, let us try to understand these three words.
- Management: Management is the art of getting things done through and with the people in formally organised groups.
- Information: Information is data that is processed and is presented in a form which assists decision-making. It may contain an element of surprise, reduce uncertainty or provoke a manager to initiate an action.
- System: A system is an orderly grouping of interdependent components linked together according to a plan to achieve a specific goal. The term system is the most loosely held term in management literature because of its use in different contexts.
Components of MIS
The major components of MIS are:
- People Resources: People are required for the operation of all information system.
- Data Resources: Database holds processed and organized data.
- Software Resources: It includes all sets of information processing instruction.
- Hardware Resources: Include all physical devices and materials used in information processing.
- Process: is a step undertaken to achieve a goal.
Objectives of MIS
- Data Capturing: MIS capture data from various internal and external sources of the organization. Data capturing may be manual or through computer terminals.
- Processing of Data: The captured data is processed to convert into the required information. Processing of data is done by such activities as calculating, sorting, classifying, and summarizing.
- Storage of Information: MIS stores the processed or unprocessed data for future use. If any information is not immediately required, it is saved as an organization record, for later use.
- Retrieval of Information: MIS retrieves information from its stores as and when required by various users.
- Dissemination of Information: Information, which is a finished product of MIS, is disseminated to the users in the organization. It is periodic or online through a computer terminal.
Characteristics of MIS
MIS plays a very important role in every aspect of an organization. These characteristics are generic in nature. Following are the characteristics of MIS:
The information system follows a System’s approach. The system’s approach implies a holistic approach to the study of system and its performance in the light for the objective for which it has been constituted.
The top-down approach must be followed while designing the MIS. The top-down approach suggests that the system development starts from the determination of management needs and overall business objectives.
The MIS development plan should be derived from the overall business plan. Management oriented characteristic of MIS also implies that the management actively directs the system development efforts.
MIS design and development should be as per the information needs of managers at different levels, strategic planning level, management control level and operational control level. In other words, MIS should cater to the specific needs of managers in an organization’s hierarchy.
MIS should be developed on the exception-based reporting principle, which means an abnormal situation, i.e. the maximum; minimum or expected values vary beyond tolerance limits. In such situations, there should BE exception reporting to the decision-maker at the required level.
Besides exception-based reporting, MIS should also look at the future. In other words, MIS should not merely provide past or historical information; rather it should provide information, on the basis of projections based on which actions may be initiated.
Integration is a necessary characteristic of a management information system. Integration is significant because of its ability to produce more meaningful information.
For example, in order to develop an effective production scheduling system, it is necessary to balance such factors as setup costs, Workforce, Overtime rates, Production capacity, Inventory level, Capital requirements and Customer services.
Long Term Planning
MIS is developed over relatively long periods. Such a system does not develop overnight. A heavy element of planning is involved. The MIS designer must have the future objectives and needs of the company in mind.
The process of MIS development is quite complex and one is likely to lose insight frequently. Thus, the system, though viewed as a single entity, must be broken down into digestible sub-systems which are more meaningful at the planning stage.
A central database is a mortar that holds the functional systems together. Each system requires access to the master file of data covering inventory, personnel, vendors, customers, etc. It seems logical to gather data once, validate it properly and place it on a central storage medium, which can be accessed by any other subsystem.
Advantage of MIS
A good management information system can be used not only for the storage of electronic data alone but must be able to support the analysis required by management. There are many advantages of MIS which are utilised by manager to achieve organization goal.
The following are some of the benefits of a good MIS.
- Increased customer satisfaction
- Improved quantity and quality of information
- Improved quality and quantity management decisions
- Improved quality and responsiveness number of the competitor’s condition
- Improved operational efficiency and flexibility
- Improved quality of internal and external communications
- Improved quality of planning
- Improved quality control and supervision
Role of MIS
A management information system (MIS) plays an important role in business organizations.
- Decision making: Management Information System (MIS) plays a significant role in the decision-making process of any organization. In any organization, a decision is made on the basis of relevant information which can be retrieved from the MIS.
- Coordination among the department: Management Information System satisfy multiple need of an organization across the different functional department.
- Finding out Problems: As we know that MIS provides relevant information about every aspect of activities. Hence, if any mistake is made by the management then MIS, information will help in finding out the solution to that problem.
- Comparison of Business Performance: MIS store all past data and information in its Database. That why the management information system is very useful to compare business organization performance.
- Strategies for an Organization: Today each business is running in a competitive market. An MIS supports the organization to evolve appropriate strategies for the business to assent in a competitive environment.
Challenges of MIS
- High Cost: Development of new computerized based information system is a problem for the organization due to the cost factor and it creates problems because with the change of time there is need of up-to-date of the information system.
- Training of Employee: Employees should have the capacity of learning of the information system with the changing competitive and business environment; otherwise it will be difficult for the organization to stay in the market.
- Maintenance Cost: Sometimes a problem arises due to server crash and website crash. Sometimes it leads to the loss of information. So, maintenance cost is needed to tackle the above problem.
Limitations of MIS
Even though MIS has many benefits but it also has its limitations. Limitations of MIS are discussed below:
- While MIS may solve some critical problems but it is not a solution to all problems of an organization.
- It cannot meet the special demands of each person.
- MIS if designed in an improper manner does not serve the management and hence is of little relevance.
- The MIS is not good if the basic data is obsolete and outdated.
- Mostly information provided by the MIS is in quantitive form. Hence, it ignores the qualitative information like the attitude of an employee.
Management Information Systems (MIS), referred to as Information Management and Systems, is the discipline covering the application of people, technologies, and procedures collectively called information systems, to solving business problems.
- Sadagopan, Management Information System, 2007, Prentice Hall of India.
- McLeod, R. and George P Schell (2008). Management information systems (10th ed.). Pearson Education India
- C. W. Frenzel and J. C. Frenzel, 2004. “Management of Information Technology”, 4th edition Thomson course technology, Cengage Learning.
- Laudon, K. C. & Laudon, J. P. Management Information Systems: Managing the Digital Firm. 10th ed. Prentice-Hall and Pearson Education, 2006.
Go On, Share article with Friends
Did we miss something in Management Information System Tutorial? Come on! Tell us what you think about our article on What is MIS? Meaning, Definition, Objectives, Role  in the comments section.