D & MIS

What is MIS?
MIS is the use of information technology, people, and
business processes to record, store and process data to
produce information that decision makers can use to
make day to day decisions. The full form of MIS
is Management Information Systems.
 The purpose of MIS is to extract data from varied
sources and derive insights that drive business growth.
Components of MIS
Types of Information Systems
Manual Information Systems VS Computerized Infor
mation Systems (MIS)
Advantages and Dis
-advantages of a manual information system
Advantages and Disadvantages of a computerized info
rmation system (MIS)
The need for MIS
The following are some of the justifications for having an MIS system.
Decision makers need information to make effective
decisions. Management Information Systems (MIS) make this possible.
MIS systems facilitate communication within and outside the
organization – employees within the organization are able to easily
access the required information for the day to day operations. Facilitates
such as Short Message Service (SMS) & Email make it possible to
communicate with customers and suppliers from within the MIS system
that an organization is using.
Record keeping – management information systems record all business
transactions of an organization and provide a reference point for the
transactions.
Components of MIS
The major components of a typical MIS long-form (Management
Information System) are:
People – people who use the information system
Data – the data that the information system records
Business Procedures – procedures put in place on how to record,
store and analyze data
Hardware – these include servers, workstations, networking
equipment, printers, etc.
Software – these are programs used to handle the data. These
include programs such as spreadsheet programs, database
software, etc.
The type of information system that a user uses
depends on their level in an organization. The
following diagram shows the three major levels of
users in an organization and the type of information
system that they use.
Transaction Processing Systems (TPS)
This type of information system is used to record the
day to day transactions of a business. An example of a
Transaction Processing System is a Point of Sale (POS)
system. A POS system is used to record the daily sales.
Management Information Systems (MIS)
Management Information Systems abbreviated as
MIS, are used to guide tactic managers to make semi-
structured decisions. The output from the transaction
processing system is used as input to the MIS system.
Decision Support Systems (DSS)
Decision support systems are used by top level
managers to make semi-structured decisions. The
output from the Management Information System is
used as input to the decision support system.DSS
systems also get data input from external sources such
as current market forces, competition, etc.
Manual Information Systems VS Computerized
Information Systems (MIS)
Data is the bloodstream of any business entity.
Everyone in an organization needs information to
make decisions. An information system is an
organized way of recording, storing data, and
retrieving information.
Manual Information System
A manual information system does not use any computerized devices.
The recording, storing and retrieving of data is done manually by the
people, who are responsible for the information system.
The following are the major components of a manual information system
People –people are the recipients of information system
Business Procedures –these are measures put in place that define the
rules for processing data, storing it, analyzing it and producing
information
Data –these are the recorded day to day transactions
Filing system – this is an organized way of storing information
Reports –the reports are generated after manually analyzing the data
from the filing system and compiling it.
Advantages and Dis-advantages of a manual
information system
Advantages:
The following are the advantages of manual information
systems
Cost effective – it is cheaper compared to a computerized
system because there is no need to purchase expensive
equipment such as servers, workstations, printers, etc.
Flexible –evolving business requirements can easily be
implemented into the business procedures and
implemented immediately
Disadvantages:
The following are some of the disadvantages of a manual
information system.
Time consuming –all data entries need to be verified before filing,
this is a time consuming task when done by humans. Retrieving
data from the filing system also takes a considerable amount of time
Prone to error – the accuracy of the data when verified and
validated by human beings is more prone to errors compared to
verification and validation done by computerized systems.
Lack of security – the security of manual systems is implemented
by restricting access to the file room. Experience shows
unauthorized people can easily gain access to the filing room
Duplication of data –most departments in an
organization need to have access to the same data. In a
manual system, it is common to duplicate this data to
make it easy to accessible to all authorized users. The
challenge comes in when the same data needs to be
updated
Data inconsistency – due to the duplication of data, it is
very common to update data in one file and not update
the other files. This leads to data inconsistency
Lack of backups – if the file get lost or mishandled, the
chances of recovering the data are almost zero.
Computerized information system
Computerized systems were developed to address the
challenges of manual information systems. The major
difference between a manual and computerized
information system is a computerized system uses a
combination of software and hardware to record,
store, analyze and retrieve information.
Advantages and Disadvantages of a computerized
information system (MIS)
The following are some of the disadvantages of a
computerized information system.
Advantages:
The following are the advantages of computerized
information systems
Fast data processing and information retrieval – this
is one of the biggest advantages of a computerized
information system. It processes data and retrieves
information at a faster rate. This leads to improved
client/customer service
Improved data accuracy – easy to implement data
validation and verification checks in a computerized
system compared to a manual system.
Improved security – in addition to restricting access to the database server,
the computerized information system can implement other security controls
such as user’s authentication, biometric authentication systems, access
rights control, etc.
Reduced data duplication – database systems are designed in such a way
that minimized duplication of data. This means updating data in one
department automatically makes it available to the other departments
Improved backup systems – with modern day technology, backups can be
stored in the cloud which makes it easy to recover the data if something
happened to the hardware and software used to store the data
Easy access to information – most business executives need to travel and
still be able to make a decision based on the information. The web and
 Mobile technologies make accessing data from anywhere possible.
Disadvantages:
It is expensive to set up and configure – the organization has to
buy hardware and the required software to run the information
system. In addition to that, business procedures will need to be
revised, and the staff will need to be trained on how to use the
computerized information system.
Heavy reliance on technology – if something happens to the
hardware or software that makes it stop functioning, then the
information cannot be accessed until the required hardware or
software has been replaced.
Risk of fraud – if proper controls and checks are not in place, an
intruder can post unauthorized transactions such as an invoice for
goods that were never delivered, etc.
MIS stands for Management Information System. It is a
collection of people, procedures, data, and information
technology that aids managers to make informed
decisions.
Computerized information systems are more efficient
compared to manual information systems. Manual
information systems are cheaper compared to
computerized information systems.
Transaction processing systems (TPS) are by operational
staff to record day to day business transactions, and they
are used to make structured decisions
Management Information Systems (MIS) are used by
middle-level managers to make semi-structured
decisions
Decision Support Systems are used by top level
managers, and they help top level managers to make
unstructured decisions.
HOW INFORMATION SYSTEMS ARE
TRANSFORMING BUSINESS
Changes in technology and new innovative business
models have transformed social life and business
practices. Smartphones, social networking, texting,
emailing, and Webinars have all become essential
tools of business because that’s where your customers,
suppliers, and colleagues can be found.
Businesses are using information technology to sense
and respond to rapidly changing customer demand,
reduce inventories to the lowest possible levels, and
achieve higher levels of operational efficiency.
As newspaper print readership continues to decline, more than 168
million people read a newspaper online, and millions more read
other news sites.
About 83 million people watch a video online every day, 66 million
read a blog, and 25 million posts to blogs, creating an explosion of
new writers and new forms of customer feedback that did not exist
five years ago.
Social networking site Facebook attracted over 1 billion monthly
visitors in 2014 worldwide. Businesses are starting to use social
networking tools to connect their employees, customers, and
managers worldwide.
Many Fortune 500 companies now have Facebook pages, Twitter
accounts,
E-commerce and Internet advertising continues to
expand.
Strategic Business Objectives of Information Systems

Entire sectors of the economy are nearly inconceivable

without substantial investments in information
systems. E-commerce firms such as Amazon, eBay, and
Google, simply would not exist. Today’s service
industries – finance, insurance, and real estate, as well
as personal services such as travel, medicine, and
education – could not operate without information
systems.
Similarly, retail firms such as Walmart and
manufacturing firms such as General Electric require
information systems to survive and prosper.
Just as offices, telephones, filing cabinets, and efficient
tall buildings with elevators were once the foundations
of business in the twentieth century, information
technology is a foundation for business in the twenty-
first century.
There is a growing interdependence between a firm’s
ability to use information technology and its ability to
implement corporate strategies and achieve corporate
goals. What business would like to do in five years
often depends on what its systems will be able to do.
WHAT’S NEW IN MANAGEMENT
INFORMATION SYSTEMS?
Lots! What makes management information systems
the most exciting topic in business is the continual
change in technology, management use of the
technology, and the impact on business success. New
businesses and industries appear, old ones decline,
and successful firms are those that learn how to use
the new technologies
There are three interrelated changes in the technology
area:
 (1) the emerging mobile digital platform,
 (2) the growing business use of "big data," and
(3) the growth in “cloud computing,” where more and
more business software runs over the Internet
WHAT’S NEW IN MIS
More and more business computing is moving from
PCs and desktop machines to these mobile devices.
Managers are increasingly using these devices to
coordinate work, communicate with employees, and
provide information for decision making. We call
these developments the “emerging mobile digital
platform.”
Millions of managers rely heavily on the mobile digital
platform to coordinate suppliers and shipments,
satisfy customers, and manage their employees.
 A business day without these mobile devices or
Internet access would be unthinkable.
The emerging mobile platform greatly enhances the
accuracy, speed, and richness of decision making
THE EMERGING DIGITAL FIRM
A digital firm is one in which nearly all of the
organization’s significant business relationships with
customers, suppliers, and employees are digitally
enabled and mediated.
 Core business processes are accomplished through
digital networks spanning the entire organization or
linking multiple organizations.
Business processes refer to the set of logically related
tasks and behaviors that organizations develop over time to
produce specific business results and the unique manner in
which these activities are organized and coordinated.
Developing a new product,
generating and fulfilling an order,
 creating a marketing plan,
and hiring an employee are examples of business processes,
and the ways organizations accomplish their business
processes can be a source of competitive strength
Key corporate assets—intellectual property, core
competencies, and financial and human assets—are
managed through digital means. In a digital firm, any
piece of information required to support key business
decisions is available at any time and anywhere in the
firm.
Digital firms sense and respond to their environments far more
rapidly than traditional firms, giving them more flexibility to
survive in turbulent times.
Digital firms offer extraordinary opportunities for more flexible
global organization and management. In digital firms, both
time shifting and space shifting are the norm.
Time shifting refers to business being conducted continuously,
24/7, rather than in narrow “work day” time bands of 9 a.m. to 5
p.m. Space shifting means that work takes place in a global
workshop, as well as within national boundaries.
Work is accomplished physically wherever in the world it is best
accomplished.
STRATEGIC BUSINESS OBJECTIVES OF
INFORMATION SYSTEMS
What makes information systems so essential today?
Information systems are essential for conducting day-
to-day business in the United States and most other
advanced countries, as well as achieving strategic
business objectives.
Entire sectors of the economy are nearly inconceivable
without substantial investments in information systems.
E-commerce firms such as Amazon, eBay, Google, and
E*Trade simply would not exist.
 Today’s service industries— finance, insurance, and real
estate, as well as personal services such as travel,
medicine, and education—could not operate without
information systems. Similarly, retail firms such as Wal-
Mart and Sears and manufacturing firms such as
General Motors and General Electric require
information systems to survive and prosper.
Just as offices, telephones, filing cabinets, and efficient
tall buildings with elevators were once the foundations
of business in the twentieth century, information
technology is a foundation for business in the twenty-
first century.
There is a growing interdependence between a firm’s ability
to use information technology and its ability to implement
corporate strategies and achieve corporate goals
What a business would like to do in five years often depends
on what its systems will be able to do. Increasing market
share, becoming the high-quality or low-cost producer,
developing new products, and increasing employee
productivity depend more and more on the kinds and
quality of information systems in the organization. The
more you understand about this relationship, the more
valuable you will be as a manager.
Specifically, business firms invest heavily in
information systems to achieve six strategic business
objectives:
 operational excellence;
 new products, services, and business models;
customer and supplier intimacy;
 improved decision making;
 competitive advantage; and survival.
Operational Excellence
Businesses continuously seek to improve the efficiency
of their operations in order to achieve higher
profitability.
Information systems and technologies are some of the
most important tools available to managers for
achieving higher levels of efficiency and productivity
in business operations, especially when coupled with
changes in business practices and management
behavior
Operational Excellence Businesses continuously seek
to improve the efficiency of their operations in order to
achieve higher profitability. Information systems and
technologies are some of the most important tools
available to managers for achieving higher levels of
efficiency and productivity in business operations,
especially when coupled with changes in business
practices and management behavior.
Walmart, the largest retailer on earth, exemplifies the
power of information systems coupled with brilliant
business practices and supportive management to
achieve world-class operational efficiency. In fiscal year
2012, Walmart achieved $460 billion in sales—nearly
one-tenth of retail sales in the United States—in large
part because of its Retail Link system, which digitally
links its suppliers to every one of Walmart’s stores.
As soon as a customer purchases an item, the supplier
monitoring the item knows to ship a replacement to the
shelf
New Product s, Service s, and Business Models Information
systems and technologies are a major enabling tool for firms to
create new products and services, as well as entirely new business
models.
A business model describes how a company produces, delivers, and
sells a product or service to create wealth. Today’s music industry is
vastly different from the industry a decade ago. Apple Inc.
transformed an old business model of music distribution based on
vinyl records, tapes, and CDs into an online, legal distribution
model based on its own iPod technology platform.
Apple has prospered from a continuing stream of iPod innovations,
including the iTunes music service, the iPad, and the iPhone.
Customer and Supplier Intimacy
When a business really knows its customers, and
serves them well, the customers generally respond by
returning and purchasing more. This raises revenues
and profits. Likewise with suppliers: the more a
business engages its suppliers, the better the suppliers
can provide vital inputs. This lowers costs. How to
really know your customers, or suppliers, is a central
problem for businesses with millions of offline and
online customers
High-end hotels exemplify the use of information
systems and technologies to achieve customer intimacy.
These hotels use computers to keep track of guests’
preferences, such as their preferred room temperature,
check-in time, frequently dialed telephone numbers,
and television programs, and store these data in a large
data repository.
Individual rooms in the hotels are networked to a
central network server computer so that they can be
remotely monitored or controlled.
When a customer arrives at one of these hotels, the
system automatically changes the room conditions,
such as dimming the lights, setting the room
temperature, or selecting appropriate music, based on
the customer’s digital profile.
The hotels also analyze their customer data to identify
their best customers and to develop individualized
marketing campaigns based on customers’ preferences
Improved Decision Making Many business managers
operate in an information fog bank, never really having
the right information at the right time to make an
informed decision. Instead, managers rely on forecasts,
best guesses, and luck. The result is overor
underproduction of goods and services, misallocation
of resources, and poor response times. These poor
outcomes raise costs and lose customers. In the past
decade, information systems and technologies have
made it possible for managers to use real-time data
from the marketplace when making decisions.
For instance, Verizon Corporation, one of the largest
telecommunication companies in the United States,
uses a Web-based digital dashboard to provide
managers with precise real-time information on
customer complaints, network performance for each
locality served, and line outages or storm-damaged
lines. Using this information, managers can
immediately allocate repair resources to affected areas,
inform consumers of repair efforts, and restore service
fast.
Competitive Advantage When firms achieve one or more of
these business objectives—operational excellence; new
products, services, and business models; customer/supplier
intimacy; and improved decision making—chances are they
have already achieved a competitive advantage.
Doing things better than your competitors, charging less for
superior products, and responding to customers and
suppliers in real time all add up to higher sales and higher
profits that your competitors cannot match. Apple Inc.,
Walmart, and UPS are Enterprise industry leaders because
they know how to use information systems for this purpose.
Survival Business firms also invest in information
systems and technologies because they are necessities
of doing business. Sometimes these “necessities” are
driven by industry-level changes.