Types and Challenges of Management Information Systems
Types and Challenges of Management Information Systems

Management Information Systems and its types

MIS, its characterstics, types and much more


What is an Information System?

Information system is considered as the integrated set of components that are utilised for collecting, storing as well as processing data. It is also useful for providing knowledge, digital products and information. Almost every business organisation as well as all other industries basically rely on Information Systems. It is through this, their operations are carried out and the systems are managed. It also allows them to properly interact with their suppliers and customers in the market.

Information systems are typically useful to learn the supply chain of the organisation and the online market. For example, organisations use Information Systems so as to process their financial accounts, manage human resources and to reach towards the potential customers through online platforms. A number of major organisations are entirely built around Information Systems including Amazon, Alibaba, Google and eBay. Apart from this, the government also deploys information systems so as to provide cost-effective services to the citizens.

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Management Information Systems is certainly an important aspect for the righteous growth of an organisation. It helps the company adopt the right methodologies and stay updated with respect to technology. Also each type of MIS has different uses. Further there are few challenges also, which MIS users face. This article describes them all, the advantages, types, challenges and even the tips to overcome the respective challenges.

 

The digital tools such as video products, software, online services, gaming, social networking, and electronic books all are delivered with the help of information systems. Individuals rely on information systems such as the internet in order to make connections with each other and for the purpose of socializing, shopping, banking, entertainment, and study.

Further, Management information systems play an important role in an organisation where professionals rely on technology for each and every aspect of operation. Also, marketing and sales rely heavily on such software which facilitates customer relationships. This helps in easy tracking of client directions and interests. Additionally, invoicing can be easily done, for the sake of financial tracking as well as billing. Moreover, more than half of the organisations today rely on the technology of Big Data Analytics where the management information system plays an imperative role.

What are Management Information Systems?

A management information system is considered as a computer system that comprises Software and Hardware, which serves as the backbone of operations of any organisation. In short, Management information systems basically collect data from a number of online systems and analyse the information. This is done in order to provide reports that are further helpful in the decision-making process of management. The main purpose of the Management Information System is to provide an improved decision-making system through up-to-date and accurate data. This data is retrieved from a number of organisational assets including inventory, personal, project timelines, financials, manufacturing, marketing, raw material, and Research and Development.

Further, the data collected is stored under MIS and is then made accessible to the managers in order to run reports in the organisations. The goal of Management Information Systems is to correlate the data points of the organisation so as to improve their organisational operations in a strategic way. In addition to this, Management Information System is also utilised for decision making, coordination, control, analysis as well as visualisation of the information.

In the corporate environment, the ultimate goal of using a Management Information System is to create profit and value for the businesses. This is largely done by providing the managers with appropriate and timely information which ultimately allows them to make effective organisational decisions in less time.

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Definition of Management Information Systems

Management information system is considered as a computerized database including financial information. It is programmed and organised in a way that it can produce regular reports on the basis of organisational operations. With the help of this, it is also possible to generate a special report for each and every management level present in the organisation. It provides the managers with feedback about their performance, which can further be monitored by the top management as well as the company.

The information provided by the MIS includes actual data over the planned results, which means that it measures progress against the organisational objectives. For this, it receives the data from the company functions and units. While some data gets automatically collected from the computer. After this, the checking process is followed. Also, routine reports are made and pre-programmed on different intervals with the use of built in query languages.

What does MIS stand for in business?

In business, MIS stands for Management Information System or Management Information Services. This further includes a computer based system for the proper organisational evaluation and management of departments within a particular organisation. It is useful in business for the calculation of past present and future prediction about information. It is done with the use of a particular spot after which is for the utilised for data resources and decision-making processes.

The role of Management Information System manager is to focus on the information and technology systems of the organisation. It is useful for analysing the critical business problems and designing and maintaining the applications of computers so that organisational problems can be resolved. Within the companies as well as the large organisations, there are departments that are responsible for handling computer science and the system is known as MIS department.

Characteristics of Management Information System

There are a number of characteristics of Management Information System. These include system approach, management orientation requirements and future orientation. Also, MIS systems can reveal more data related to the customer. With the more data related to the customers’ requirements, management is able to further improve the customer service. Along with this, it also results in designing an effective strategy for marketing and promotion.Further, Management information systems are considered as necessary for each and every business owner, in order to enhance the performance of the company as well as to make intelligent decisions.

Moving further, MIS is also helpful in managing the information and facilitating a proper communication between the teams. It provides a collaborative environment to improve teamwork and also allows the organisational transformation.

Following are the mean characteristics of management information systems.

  • System approach

    System approach is followed by a Management Information System, which includes a step-by-step guidance. This is to study a particular system and its performance with respect to the main goals of the organisation. It further offers an inclusive view of such systems that is helpful in the smooth operations within a particular organisation.

  • Management orientation

    The management orientation characteristic of management information systems means that it includes a top down approach. It is required to be followed for designing the Management Information System. Further, the use of top down method means that the initiation of a system development phase basically investigates requirements of management along with the goals of business.

  • Feedback system

    A Management Information System has the characteristic of providing a feedback system about effectiveness and efficiency of working. Examples of feedback systems include the transaction processing of error rate as well as malfunctioning of the computer reporting system.

    The Management Information Systems also prepares the statistics including each and every facility as well as its uses in a sophisticated environment. Also, computer programs can report and record how much computer time is used by each and every user as well as the internal data files, which are used by different users.

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  • Enhance the productivity

    The utilisation of Management Information Systems in the organisation has a direct impact on productivity in different ways. MIS enables written tasks including document preparation in an effective and efficient manner in order to provide a high level of service to the internal and external organisations suppliers and individuals. It also includes early notice of opportunities along with several facilities associated with the management processes of the organisation. It further enhances the ability of managers to deal with several management problems.

  • Confirmation of managers styles and characteristics

    A management information system has the ability to develop unique managerial styles along with the behavioural patterns of the employees. At the senior level of organisation, the information system is carefully tailored at each and every step with respect to the personal taste. This helps in enhancing the productivity and style of the managers. On the other hand, at the lowest levels of the organisation, the rule of management information system is more sophisticated. It differs in the way of providing operational and clerical personal use of information and a proper interaction with information systems. Apart from this, the middle managers, the information system is tailored to general characteristics associated with the managers. For the technical and professional personnel, the information system is designed with respect to specialised tasks.

  • Transformation of data into information

    One of the most useful characteristics of using a Management Information System is the transformation of data into the information in a number of ways. When there is a processing of data it becomes useful for a particular management for conducting a particular task and it then becomes information. There are a number of ways by using which data can easily be transformed within an information system. For example, the cost data for the organisation can be summarised on the basis of full cost standard cost and variable cost for each and every organisational unit as well as for each and every type of customer, product, and cost.

    The several ways in which management information systems should transform data into the information is determined by its characteristics related to organisational personal as well as the particular task for which the information is required.

  • Computerized system

    It is possible to have an MIS without using a particular computer and its use increases the overall effectiveness of a system. It uses equipment to handle a number of applications with the facility to fulfil quick information requirements. Other important attributes related to computer and Management Information Systems include consistency and accuracy of data processing as well as the reduction in staff. These requirements in the management information system makes computers a prime requirement.

  • Coordinated system

    The Management Information System is considered central in order to ensure the coordination of information. It has to maintain a smooth flow of information in the office automation system. It is also responsible to maintain a constant flow to and from the information systems, across the office.

  • Comprehensive

    A Management Information System is considered comprehensive in nature because it comprises a transactions processing system along with an information system. It is designed primarily for all levels of managers. It also includes other systems such as formal and informal systems, office automation systems, computer systems, project information systems, forecasting system manual and computer systems. It also consists of a decision support system, intelligent information system and computer models that can easily process the business data along with other specialised data structurally in a distinctive manner.

  • Flexible

    A Management Information System is designed in such a way that it can easily be modified. It is processed to fetch information from various sources and to enable the office administration work according to the change. This system includes new models and modes of processing the MIS, which are capable to expand and accommodate the growth of new processing units.

Types of Management Information Systems

Management Information System is used to provide an inclusive picture of an organisation and it enhances the operational productivity. It adds value to existing products, motivates the innovation as well as improves the development of products. It further assists the managers to make better decisions for their organisations. There are different types of Management Information System including process control, management control, sales and marketing, human resource management, expert and executive information system. Following are some of the most important management innovation system:

Types of Management Information Systems
  • Process control

    Process control system monitors industrial processes of business such as automobile assembly metal fabrication and petroleum processes. The process control system collects data and makes a report on the basis of system performance. It is considered as one of the most essential types of Management Information System, from the perspectives of manufacturing organisation.

  • Management reporting system

    Management Reporting System is designed basically to produce the reports related to finances and operations of management in a particular organisation. It is helpful for the managers to compare the performance of the organisation with its previous year performance. In this way the manager has the ability to evaluate the performance as well as add to its improvement. The generated performance report can be utilised by upper management. This allows them to compare the potential financial output and efficiency of operations with the objectives of the organisation.

  • Inventory control

    Inventory of a particular company include sales, inventory on hand, theft and spoilage. It takes all the things as well as updating the management about the inventory system. In this way the management can evaluate the individual items that are required to stock in the warehouse and retail stores of the organisation. Inventory system is also helpful in keeping track of inventory movement in the warehouse. It includes the items sold, return on them and at the department store. It is also one of the most essential types of Information Management Systems, which is utilised by the retail organisations in dealing with storage and stocking of goods and products.

  • Sales and marketing

    This system is helpful for the management to track and execute the efficiency of marketing functions as well as the sales of the organisation. The marketing function comprises projected sales, improved quality of products, pricing advertising, discounts, effective advertising, sales promotions, and schedules. These reports have the ability to evaluate the level of sales as well as check the products that are not doing good in retail stores.

  • Human resource or enterprise collaboration or office automation

    This Information Management System has the ability to allow management to control the information flow around the organisation. In this process, several electronic devices are being utilised by the managers in order to make communication with other departments employees. This is considered as part of the system of auto office automation. These media devices Basically include landline, phones, cell phone, internet, email, voice mail, file sharing and video conferencing.

    Human resource management system keeps the track of employees as well as the recruitment system and is accountable for the daily management operations. This system is also helpful in tracking the financial elements including retirement, profits, and payroll which is the essential part of the financial and accounting system. With the use of this, there can be proper communication between human resource managers, management and employees.

  • Accounting and Finance

    The system of accounting and Finance can track the Assets and investments of the particular organisation. The data which is gathered from these processes is assembled for the purpose of financial reporting. This information is demanded by law in order to deal with several functions including pension funds, state local tax and payroll. This system also assesses daily posting of transactions such as returns transfers, bank deposits and sale income and different types of statements annually or monthly can be produced with the use of this system. These statements are considered as crucial to measure the performance of the organisation and are beneficial for both the middle and upper management.

  • Decision support system

    Decision support system is a form of management information system which is designed in such a way that it can be helpful for the managers to make a decision for a particular situation. The data is collected from internal and external resources. This can include, cost of new house construction, population trends, and interest rate. These are the factors associated with external sources whereas inventory financial data sales and manufactory are the example of internal sources of information.

  • Expert system

    The expert system associated with Management Information System is designed in such a way that it stores knowledge related to human export. This is done with respect to a particular subject which is utilised to assist the people who have lower expertise. It uses one of the most effective technologies i.e. Artificial Intelligence. With the use of artificial intelligence technology, the expert system makes use of sensors for sensing the actions and comparing them. It is also helpful for making the logical assumptions.

  • Executive information system

    The utilisation of Executive Information System is done for assisting the Executive Manager so as to perform and manage the executive function. This system also includes the information in the form of charts and tables which is necessary for a manager so as to make important decisions and analyse data.

  • Transaction processing system

    Transaction Processing System is a type of MIS, which is used to collect as well as process the data. This information is produced during the routine activities of a particular organisation. These activities can include reservation, deposits, payments, and orders.

Management information system examples

Most of the common examples of MIS include clarity professional information system, Fleetmatics Work, and Microsoft dynamics. The programs of management information systems are designed specifically for the print and graphics industry including EFI Pace, DDS Accura, and Avanti Slingshot. Moreover, Human Resource, enterprise collaboration or office automation are also examples of MIS. These have the ability to allow management to control the information flow around the organisation.

A management information system has the characteristic of providing a feedback system about effectiveness and efficiency of working. Examples of feedback systems include the transaction processing of error rate as well as malfunctioning of the computer reporting system. The management information systems also prepares the statistics including each and every facility as well as its uses in a sophisticated environment.

Computer programs can also report and record how much computer time is used by each and every user. Apart from this, the examples of management information system comprise of:

  • Intellectual Property Management

  • Clinical information system

  • Electronic health record

  • Research Management

  • Innovation management

  • Transfer tax processing

  • Personal data

  • Expense reporting

  • Project management

  • Web conferencing

  • Record management

  • Document management

  • Electronic content management

  • Geographic information system

  • Executive information system

  • Data warehouses

  • Analytics and text analytics

  • Production markets

  • Visualisation

  • Competitive intelligence

  • Intelligence support system

  • Robotic process automation

Advantages of management information systems

There are a number of benefits of Management Information Systems as:

  • It helps in achieving higher efficiency levels, quality of decisions, and promotes better communication between different departments.

  • Management Information Systems are used to provide an inclusive picture of the organisation and enhances the operational productivity.

  • It adds value to existing products, motivates innovation as well as improves the development of products to assist managers to make better decisions for their organisations.

  • MIS basically collects data from a number of online systems and analyses the information in order to provide reports. These are further helpful in the decision-making process of management.

  • The main purpose of the Management Information System is to provide an improved decision-making system. It is facilitated through up-to-date and accurate data from a number of organisational assets including inventory, personal, project timelines, financials, manufacturing, marketing, raw material, and Research and Development. Under MIS, the data collected is stored and made accessible for the managers in order to run reports in the organisations.

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  • A Management Information System is designed in such a way that can easily be modified. For example, different types of information are required due to the environment changes or the changes in the organisation for new activities. Also, the MIS is capable of expanding and accommodating the growth of new processing units.

  • A management information system has the characteristic of providing a feedback system about effectiveness and efficiency of working.

  • A management information system is considered comprehensive in nature because it comprises a transactions processing system along with an information system which is designed primarily for all levels of managers.

  • The goal of an MIS is to correlate the data points of an organisation so as to improve their organisational operations in a strategic way.

  • Management Information System is also utilised for decision making, coordination, control, analysis as well as visualisation of the information.

  • The Management Information System is considered central to ensure that the data processing the intelligence decision support and office automation system is operated and developed in coordinated manner. This is to further ensure that the information can be communicated back and forth among different subsystems as per the requirement.

  • Management Information systems are able to evaluate different scenarios that are present for different alternatives as well as economic environments.

  • Employees are more productive due to the fact that they do not need to spend their time in the collection of data. Therefore, it can be said that the utilization of Management Information Systems has the ability to improve the productivity of the employees. In fact an MIS can collect the data without any interference of employees.

  • MIS systems also have the advantage to gain the competitive strength of the organization. It is because this system runs on a more efficient business platform with the reduction in weaknesses and non performing areas of the organization.

  • MIS systems can reveal more data related to the customer. With this exploration, management is able to better improve the customer service as well as designs an effective strategy of marketing and promotion.

  • Management Information System is believed to be necessary for each and every business owner in order to improve the performance of the company as well as to make intelligent decisions.

  • Management Information System is helpful for managing the information and facilitating proper communication between the teams. It provides a collaborative environment to improve teamwork and also allows the organisational transformation.

Challenges of MIS

Although the utilization of a Management Information System provides a number of benefits, it offers some challenges too. Requirement of a skilled staff, finding and withholding talented professionals, matching strides with the ever changing world of technology and development and implementation of the right strategy are some of them. Given below is a detailed account of these challenges.

  • Requirement of a skilled staff

    In order to keep Management Information Systems working in the best way, business organizations require professionals who are not only adept in the field of business but also have a good technical know-how. This is because business professionals can make most of the MIS only if they are aware of its technicalities. Further, it is not at all an easy task for organizations to find such skilled professionals. Thus, the requirement of a skilled staff is one of the biggest challenges presented by a Management Information System.

  • Finding and withholding talented professionals

    Finding talented professionals is certainly one big challenge but an even bigger one is to retain the same talent. This is because the advancements in business technology occur at a very high pace. This results in development of new opportunities for the IT professionals. These luring opportunities often distract the talent to shift from one management firm to another. Thus, it is challenging for most organizations to find and withhold MIS specialists who can manage their Management Information Systems properly.

  • Matching strides with the ever changing world of business technology

    As discussed above, advancements in business technology occur at a very high pace. Further, in order to stay ahead in the highly competitive environment of the business sector, business organizations have to regularly adopt these advancements. This implies that they have to make continuous transitions from their current Management Information System to either its upgraded version or some other MIS which is superior to it. As this transition takes place, business organizations have to put extra efforts into helping their employees adapt the respective changes, which isn’t an easy task. In fact, it is sometimes really frustrating for the employees to reprogram their mind according to the latest advancements in the management information system. Thus, to sum up, it is challenging for business organizations to match strides with the ever changing world of business technology.

  • Development and implementation of the right strategy

    Right data plays a pivotal role in organizational success and Management Information Systems help organizations collect it through their network. But, it is often not easy to handle the massive amount of data collected and interpret it properly. This makes it difficult for management to utilize the data to develop and implement the right strategies which can support the organization’s growth. Thus, business organizations have to put a lot of effort into the perfect interpretation of the data, which is quite a challenging task.

TIPS for effective implementation of MIS

The organisations that have problems in the implementation of Management Information Systems, tend to have a few things in common. While some of the organisations have an administrator for Management Information System which helps them focus on the main areas only. These types of organisations are not able to take the advantage of the implementation plan which is normally provided by the vendor of MIS. Following are some of the general tips that are required to be taken care of while implementing Management Information System successfully

  • In order to successfully apply and implement a Management Information System there is a requirement to review the customer data and update it. This will improve the valuable assets of the organisation such as customer satisfaction and retention.
  • There should be a review of chargeable rates as well as budgeted early rates with the use of cost-plus pricing method.
  • The organisation should review the production and workflow processes along with the changes so that the requirement of new equipment or new services can be satisfied.
  • The employees should be provided with all the production information in order to set up the application of Management Information System.
  • There is a requirement to keep a notepad at a workstation as well as several other equipment.

Conclusion

Hence, it can be said that in the corporate environment, the ultimate goal of using a Management Information System is to provide profit and value for the businesses. This is done by providing the managers with appropriate information, which allows them to take timely and effective organisational decisions. Also, it is useful in business to predict the past, present and future information with the use of a particular spot. This information is further utilised for data resources and decision-making processes.

Adding on, the role of MIS manager is to have the main focus on the information and technology system of the organisation. There are different types of Management Information System including process control, management control, sales and marketing, human resource management, expert and executive information system. Moreover, Management Reporting System is designed basically to produce the reports related to finances and operations of management in a particular organisation. It is helpful for the managers of the organisation to compare the performance of the organisation with its previous year performance. This helps the company growth in the right direction and also helps it to achieve the desired results.

Article By:

Paul Smith

Ex- Management faculty of University of Sydney. Along with an extensive interest in management studies, he is a sports enthusiast who loves to spend time in the basketball court. Just like smart playing the opposition in basketball, he smartly instills

Paul Smith

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