MIS business approach

Management Information
System
Business Approach

Compile by Zafar Ayub

MIS Characteristics
MIS has following characteristics and working approach
like;
A Management Information System (MIS) provides
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information which is needed to manage organizations
efficiently and effectively.
• Manage and organize
An MIS provides managers with information and support
for effective decision making, and provides feedback on
daily operations.
• Feedback for support
Output or reports, are usually generated through
accumulation of transaction processing data.
• Reports

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MIS Characteristics
Management oriented

Management directed

Sub System concept

Integrated

Common data flows

Long term business planning

Central database

Future oriented

Computerization

Policy implementation

Comprehensive audit


Management oriented: The basic objective of MIS is to
provide information support to the management in the
organization for decision making. So an effective MIS should start
its journey from assessment of management needs, mission and
goal of the business organization. This object to ensure that the

implementation of system's polices meet the specification of the
requirements, continued review, and participation of all level of
organization (top, middle, and lower).
• Review information with-in organization at all levels
• Support to business policy implementation


Management directed: When MIS is management-oriented, it
should be directed by the management because it is the
management who tells their needs and requirements more
effectively than anybody else. Manager should guideline to the
MIS professionals not only at the stage of planning but also on

system analyzation, development, implementation, and after
support; so that effective system should be the end product of
the whole exercise in making an effective MIS.
• Top and senior management directed in organization
structure
• Guideline available at all stages of system development


Sub System concept: MIS should be viewed as a single entity,
but it be broken into meaningful sub-systems for its effective
viewed. With this approach more attention and deep study could
be possible, in addition individually people responsibilities also be
assign each sub system. In sub system approach every system also

performing its roll separately but share it’s value and data with
complete MIS structure, and as individual exercise if any sub
system may has problem, other MIS structure mayn’t disturb.
• Sub systems concept, viewed MIS in structure
• Every sub system has single entity
• Individual responsibility may be assign at every sub system
• Sub system facilitate deep study and individual control
• Sub system share its data with MIS structure
• In the absence of any sub system, MIS structure mayn’t be
disturb


Integrated: It means a comprehensive or complete view of all
the sub systems in the organization. Development of information
must be integrated so that all the operational and functional
information sub systems should be worked together as a single
entity. This integration is necessary because it leads to retrieval of

more meaningful and useful information. For example store
department publish it’s record in main central database; when
plant production department required some good’s it may access
store department record’s and process to retrieve it with issue
note, and if some things are missing then circulate requisition
with demand note to procurement department as effective
approval, and when goods are arrive it’s hand over to store
department and issue to production department.
• All sub systems share their values and data with each
others


Common data flows: The integration of different sub systems
will lead to a common data flow which will further help in
avoiding duplicity and redundancy in data collection, storage and
processing. For example, the customer information process within
organization in different departments; like sales, billing, customer

support, and etc; but customer data collection in system from its
original source only one time. Then the utilization of data with
minimum number of processing procedures and uses the
information for production output documents and reports in
small numbers and eliminates the undesirable data. This will lead
to elimination of duplication that simplify the operations and
produce an efficient information system.
• Data input in system only one time
• Due to one time data feeding, same data flow in overall
MIS system
• By one time data feeding duplication may be element


Long term business planning: It’s normal practices, that
preparation of MIS is not a one or two day exercise, but It’s
usually takes 3 to 5 years and sometimes a much longer period.
So the top management and system expert has to keep two things
during system life cycle; one thing achieve existing goals, and

second future objectives forecast. And off course MIS life cycle
contain seven to ten years.
• MIS provide long term business planning
• MIS life cycle contain seven to ten years
• MIS system manage existing business scope as well future
forecast


Central database: This is core feature of MIS to achieve the
objective of using MIS in business organizations. It avoids
duplication of files, fast access of information, rapid data
updating, single place of data storage, and reduction in costs. In a
common database, master file which consolidates and integrates

data records formerly stored in many separate data files. The
organization of the database allows it to be accessed by each
subsystem and thus, eliminates the necessity of duplication in
data storage, updating, deletion and protection. Central database
may be Oracle, MS SQL, and etc.
• Single database store all record in Master File
• Avoid record duplication
• Fast information access
• Rapid record updating
• Single place of data storage
• Reduce cost


Future oriented: In new era MIS system, may provide future
forecast on the bases of existing data, market variables like
currency, GDP rate, items trend set, and etc. Commonly this
feature known as BI (Business Intelligence) tool. BI tool extend top
management dissection, future projections, and closer look to

new objectives.
• BI tool working on existing MIS reports
• As per management aspect
• variables setting also required for closed analysis


Computerization : In early age MIS was used without a
computer system, but in past MIS wasn’t as today look today MIS
structure. The usage of IT increases the effectiveness and the
efficiency of the MIS system. The queries can be handled more
quickly and efficiently with the computerized MIS. The other

benefits are accuracy, storage capacity and timely information. IT
also provide user friendly single look in all MIS structure. An MIS
should be flexible i.e. there should be room for further
modification because the MIS takes much time in preparation and
our environment is dynamic in nature. MIS should be such that it
should be used independently by the end user so that they do not
depend on the experts.
• Used of IT increase efficiency, accuracy, storage capacity,
and update information
• Due to IT, whole MIS has single look user friendly look
• IT provide MIS system flexibility with environment
• From top management to low staff every user has it’s own
working interface and area

Policy implementation: By computerization in MIS, every top
management and organization policy should be directly and
quickly implemented in whole system. And as well get short
response time with results. In every tear of organization policy
announce by memo, and there is no need for push them to work

on it, policy is automatically assemble in MIS structure, and team
required working on it.
• Direct management policy implementation
• New policy easily assemble in MIS structure
• Whole organization should be followed by policy
automatically


Comprehensive audit: As auditor point of view, there is to
difficult task to identify problem areas and hidden portion in
system if system is distribute in separate part. In MIS auditor look
directly MIS reports first, and then compare sub systems records
and manual performance reports. By MIS auditor quickly review

system with detail working.
• Without MIS audit is difficult task
• MIS reports provide base of audit
• MIS reports identify problems area and hidden area of
organization


Organization Structure

The framework, typically hierarchical, within which an
organization arranges its lines of authority and communications,

and allocate rights and duties. Organization structure determines
the manner and extent to which roles, power, and responsibilities
are delegated, controlled, and coordinated, and how information
flows between different level of management.
An structure depends entirely on the organization objectives and
the strategy chosen to achieve them. In a centralized structure, the
decision making power is concentrated in the top layer of the
management and tight control is exercised over departments and
divisions. In a decentralized structure, the decision making power is
distributed and the departments and divisions have varying degrees
of autonomy. An organizational chart illustrates the organizational
structure.


Company MIS Organization

Organization
Structure

Authority Monitoring

Communication Implementation

Responsibility Control


With respect to business working organization should be
bifurcate as following;

Top

management

Middle
management

Lower management


Top management

• Management Support System
• Policy development
• Strategy planning

Middle management

• Management Support System
• Sharing strategy
• Procedure development

Lower management

• Operation Support System
• Follow the policies
• Execute procedures

Top management: Generally board of directors known as top
management, with their authorities and decision power. Make
organization policies like HR, sales, finance, IT (IT governance),
and production. Set objective of organization associate with
strategy planning. Also part of management system support in

MIS.
Middle management: Senior manager or General managers
are middle management; sharing top management strategies
meeting, and on behalf of results develop organization working
procedures (SOP), and also part of management system support.
Lower management: All departments managers with their
departments are known as lower management, execute
organization task list as per define SOP’s and reporting to middle
management. Due to their execution activity this level of
authority is part of operation management system in MIS.


MIS Growth

Now a days we look MIS as in board view with respect to
organization structure, or we says that MIS is entire view of an

organization; but in early stages the participation of MIS in
organization was very narrow. And year by year business
development, addition of new experiments, some view of
organization experiences, market demands set, and IT technology
expansion change the structure of MIS vision in an organization.


MIS growth with respect to business requirements as
follows;
• Basic documents feeding, and record keeping
Electronic Data Processing

• On the bases of EDP generate reports
Management Reporting System

• On the bases of reports management decision process was
Decision Support System born

• Desktop computing age
End user computing

• Critical information for top management
Executive Information System

• Specialize software for lower, and middle management
Expert System

• Top management strategy support for competitive analysis
Strategic Information System

• Specialize integrated software for whole organization
ERP

• Emerging of IT in networks, storage, databases, internet,
E Commerce securities, and mobile computing

• Top management tool for business future forecast
Business Intelligence

Data Processing: In 1950s to 1960s basic information was
feed in mainframe computers, by punch card, magnetic tape, or
data entry into consol. This record keeping was use for
mathematic operation. There is no concept of software and
reports, usually those task done by lower management division

like data feeding operators.


Management Reporting System: In age 1960s to 1970s EDP
was common practices, and middle and top management desire
to get more results excepting mathematical calculation.
Software age was start and some specialize software provide
multiple report like, stock position, total sales and purchase, etc;

on the stand of this MRS become start.
A MRS is essentially a mechanism for monitoring the “mission “
of an organization; structure is define;
• Organization structure
• Time frame of organization define goals
• The critical variable of success


Decision Support System: In 1970s to 1980s, middle
management and top management was make decision on those
reports, which were get management reporting. For new business
requirements decision support system was introduce, is computer
base program, which was used planning, operation, and smart

management view of organization.
Decision Support Systems (DSS) are a specific class of
computerized information system that supports business and
organizational decision-making activities.
A properly designed DSS is an interactive software-based system
intended to help decision makers compile useful information
from raw data, documents, personal knowledge, and/or business
models to identify and solve problems and make decisions.
Typical information that a decision support application might
gather and present would be;
•Accessing all of your current information assets, including legacy
and relational data sources, cubes, data warehouses, and data
marts
•Comparative sales figures between one week and the next

•Projected revenue figures based on new product sales
assumptions
•The consequences of different decision alternatives, given past
experience in a context that is described
Conclusions

DSS based management reporting system.
DSS computerized information for supporting business
decision.
Working modules connect data, facts, knowledge, and
past management reporting system


End user computing: In start 1980s desktop computing was
introduce, and end user wasn’t depended of mainframes or
minicomputers environment. By this much more software were
used and get complex type of results, like comparing inventories,
sales analysis, etc.

EUC, the term means that the person is not a computer
programmer, but person who uses a computer as part of their
daily life or daily work, and also is not interested in computers as
such.
When end-users, who have not necessarily been taught how to
write code in conventional programming languages, write
computer programs. Examples include spreadsheet users who
write formulas and macros.
EUC is an environment in which the user has free control and
liberty over the process. He may use data that is interchanged
through the mainframe of the MIS division, or he may create his
own data. But he is in control; he is responsible for the product
and the effectiveness of the use of the equipment

Conclusions:
IN EUC, computer used in daily routine activities.
EUC application software specially design for individual
and network facility to combine applications; like MS Excel
work as individual and also with correlate with other Excel

sheets.
EUC application environment generally user friendly and
its own control.


Executive Information System: An executive information
system (EIS) is a type of management information system planned
to facilitate and support the information and decision making
needs of senior executives by providing easy access to both
internal and external information relevant to meeting the

strategic goals of the organization.
It is commonly considered as a specialized form of decision
support system DSS.
This system generally use for operational working and strategy
designing, with EIS middle management get practical approach
for their work.
These system support by specialize software which was gather
data from different source like end user report, business decision,
and management reporting.


Conclusions:
High level management decision system, which is based
on DSS.
Supportive for operational working and management
strategy designing.

Specialize software extract data from DSS and end user
reporting.


Expert System: In artificial intelligence, an expert system is a
computer system that emulates the decision-making ability of a
human expert and also be base on DSS and EIS. Expert systems
are designed to solve complex problems by reasoning about
knowledge (from with results history or some default feed

conditions); like an expert, and not by following the program
procedure as is the case in conventional programming. The first
expert systems were created in the 1970s and then get mature in
the 1980s. Expert systems were among the first truly successful
forms of AI software.
It is divided into three parts;
• one is fixed the inference engine, The processing program
in an expert system. It derives a conclusion from the facts and
rules contained in the knowledge base using various artificial
intelligence techniques, like condition checking.
• second is variable base on knowledge base, like IF __ THEN
___ ELSE command line.


• In the 80s a third part appeared; a dialog interface to
communicate with users. This ability to conduct a
conversation with users was later called conversational.
Means asking values from user during program.
Conclusions:

Base on DSS and EIS systems.
Design to solve complex programs, on the base of their
knowledge.
Initial type of IA system, start in 1970’s but mature in
1980’s
Three type inference engine, knowledge base , and dialog
interface.


Strategic Information System : In 1990’s global market
business trend become popular. For business support different
business processes, services, and products introduce gain
competitive advantages with same market competitors.
A Strategic Information System (SIS) is a system that helps

companies change or otherwise alter their business strategy or
structure.
It is typically utilized to streamline and quicken the reaction time
to environmental changes and aid it in achieving a competitive
advantage.
Conclusions:
Decision support systems that enable to develop a
strategic approach to align Information Systems (IS) or
Information Technologies (IT) with an organization's business
strategies.
Primarily enterprise resource planning solutions that
integrate/link the business processes to meet the enterprise
objectives for the optimization of the enterprise resources.

With “data mining” capabilities to make the best use of
available corporate information for marketing, production,
promotion and innovation.
The real-time information Systems that intend to maintain
a rapid-response and the quality indicators.


ERP : Enterprise resource planning (ERP) systems integrate
with MIS across an entire organization, embracing finance,
accounts, manufacturing, sales and service.
Technology backbone of e-business; it’s a enterprise framework
with links into sales order processing, distribution network,

inventory management, production process, to accounts and
finance record keeping, and for effective management MIS also
be part of system.
For supportive components Customer Relationship Management,
Supply Chain Management, and Human Resource Management
also be screw with ERP. All of these processing associate with
central database program.
Conclusions:
Entire organization business integration.
Real time management reporting.
CRM, SCM, and HRM also be part of ERP.


ERP business view;

E Commerce : E Commerce refers to the buying and selling of
products or service over electronic systems such as the Internet
and other internet network technologies.
By electronic commerce electronic funds transfer, supply chain
management, online marketing, online order processing,

inventory management and automated data collection may
possible.
E commerce is also web view or online view of an ERP with
respect to internetwork technologies (internet, intranet, and
extranet). B2B and B2C are more enhance aspect of e-commerce
and all of these activities has been done by security and SSL.
Conclusions:
Online marketing, business and services.
ERP web interface for their customers, dealers, users, and
management.
B2B and B2C are also e-commerce models.
e-commerce base on online security and SSL.

E Commerce refers like;

Business Intelligence: Business intelligence (BI) is a broad
category of applications and technologies for gathering, storing,
analyzing, and providing access to data to help enterprise users
make better business decisions.
BI is rear mirror view through the organization historical data; for

sustaining top level management and middle or senior level
management.
This technology directly associate with organization central
database to gain access MIS reports, current stock position,
company accounts ledger, and sale targets.
Conclusions:
BI is management business tool.
Provide analytical view on organization data.
BI directly associate with central database.


Business intelligence (BI) is working look;

Types of MIS

In the vision of historical growth of MIS, we should categories
complete MIS structure into two major categories; operation

support system and management support system. This
categorization conceptually based on following;
organization goal’s and objectives
responsibilities of structure
business requirements
competitor strategy
future aspect
financial aspect
historical calculation
best market practices
Some systems are common in both operation support system
and management support system like; expert system, knowledge
management system, strategic information system, and
functional business system.

MIS

Operation Management

Support Support
System System

Transaction Process Enterprise
Processing Control Collaboration
System System System

Management Decision Executive
Information Support Information

Knowledge Strategic Functional
Expert
Management Information Business
System


Operation Support System: OSS is MIS sub system where
junior management with their supportive staff, execute top
management organization policies with respect to middle
management define working procedures.
OSS provide multiple variety of services for inbound and

outbound business uses like; business transaction process,
industrial control process, and enhance collaboration between
team and different groups in enterprise environment.
Conclusions:
junior level and staff working area in monitoring of middle
management
core working and operational domain of organization
support multiple variety of services


Following subdivisions with respect to operation activates;

Transaction Processing System

Process Control System

Enterprise Collaboration System


Transaction Processing System

• Transaction processing systems record and process data
resulting for business transactions.
• Transaction process follow tow basic ways;

• Batch processing ( data transaction accumulate over
time period and process periodically)
• Real time processing ( data processing immediate base
when transaction has been occur, also know as online
processing like POS point - of - sale)
• Typically examples are information systems that process
sales, purchases, and inventory changes.
• These can be processed and used by management
information systems, decision support systems, and
executive information systems.


Process Control System

• Process control system, control physical process of MIS,

for example by SCADA (supervisory control and data
acquisition) in petroleum refinery electronic sensors
linked monitoring system, and in real time based provide
quantity and flow of oil stuff.
• Operation support systems also make routine decisions
that control operational processes.
• Automatic inventory reorder decisions and production
control decisions sub systems are process control
systems.


Enterprise Collaboration System

• Enhance team collaboration with different departments.
• Add up communication skill technology for improving

productivity with-in shortest period of time.
• Business automation required for specialized application
like SharePoint framework.
• SharePoint framework provide particular to team
management communication via e-mail application, and
when did required online database results also be
accessible during correspondence, and all framework
associate with real time network for video conferencing.
• Enterprise collaboration systems are information systems
that use a variety of information technologies to help
people work together.
• Help us collaborate to communicate ides, share
resources, and coordinate our cooperative work efforts
as members of the many formal and informal process
and project teams and other workgroups.

Management Support System: MSS sub system is top and
middle level management MIS tool, where effective decision
support and organization monitoring should be possible.
MSS based on top level policies and their results, which may
come out by operation support system.

MSS also provide multiple variety of services for inbound and
outbound business uses like; management information system,
decision support system, and executive information system.
Conclusions:
top and middle level of working
effective decision may be possible
overall organization monitoring may be possible
based on operation support system


Following subdivisions with respect to management activates;

Management Information System

Decision Support System



Management Information System
• Provide information in the format of report to top and
middle level management.
• On the base of report day by day decision should be
possible.

• Enhance management operation efficiency.
• And real time integration of database, provide most
nearest picture of business.


Decision Support System

• DSS direct access with real time database, provide real

time data figure during management decision.
• A natural progression from information reporting
systems and transaction processing systems.
• Decision support systems are interactive, computer-
based information systems that use decision models and
specialized database to assist the decision making
process of managerial end users.
• BI tool is an example of DSS, where management
interact their database history with current market
decision and then get future forecast.



• EIS are management information systems tailored to the
strategic information needs of top management.
• Top executives get the information they need from many
sources, including letters, memos, periodicals, and
reports produced manually as well as by computer
systems.
• Performance base applications are EIS examples, which
may provide overall generic report of MIS system, like
Cisco works, HP performance monitor, Oracle 10g DB
monitor, SNMP tools.


Common Support System: some other categories of
information system can support either operation or management
support system both. Means some element of these system
provide operational support at operation management system,
and some element provide management knowledge set for

management support system.
Conclusions:
Expert system, knowledge management system, strategic
information system, functional business system are examples
of common values.
All of these system are associate with each other, means
expert system based on knowledge base system.
These aren’t primary active parts but facilitate existing
deployed operation system or management support system.


Following subdivisions with respect to common support system
activates;

Expert System

Knowledge Management System


Functional Business System


Expert System
• Expert system based on knowledge base system, means
when this system going to query for specific
requirement, it’s used their database in which multiple
of knowledge and results already has been stored.

• With the reference of expert system, human decision
ability has been increased.
• Expert system design to resolve complex problems, easy
to access, and gain instance result.
• For operation support system, expert system advice
technical knowledge and in management support system
get comparison of reports.
• In customer end expert system provide customer to
achieve their nearest goal, like at amazon.com customer
easily select their appropriate category to their product
shelf, and automatically going to online purchase to
delivery.


Knowledge Management System

• Knowledge management system support creating,

organizing, and distributing business information within
organization.
• Knowledge management systems are artificial intelligent
tools working in a narrow domain to provide intelligent
decisions with justification. Knowledge is acquired and
represented using various knowledge representation
techniques rules, frames and scripts.
• The basic advantages offered by such system are
documentation of knowledge, intelligent decision
support, self learning, reasoning and explanation.


• A Strategic Information System (SIS) is a system that
helps companies change or otherwise alter their
business strategy and structure.
• It is typically utilized to streamline and quicken the

reaction time to environmental changes and aid it in
achieving a competitive advantage.
• Key features of the Strategic Information Systems are the
following;
• 1) Decision support systems that enable to develop a
strategic approach to align Information Systems (IS) or
Information Technologies (IT) with an organization's
business strategies
• 2) Primarily Enterprise resource planning solutions that
integrate/link the business processes to meet the
enterprise objectives for the optimization of the
enterprise resources



• 3) Database systems with the "data mining" capabilities

to make the best use of available corporate information
for marketing, production, promotion and innovation.
The SIS systems also facilitate identification of the data
collection strategies to help optimize database marketing
opportunities.
• 4) The real-time information Systems that intend to
maintain a rapid-response and the quality indicators.



• Functional business system support variety of
operational and managerial applications of basic

business functions of company.
• Like accounting, marketing, sales, HR, and finance etc on
the base of functional based system provide detail
knowledge of every parts of following.


MIS business approach

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